Supreme Court New South Wales Medium Neutral Citation: JR Consulting & Drafting Pty Ltd & Anor v Cummings & Ors [2014] NSWSC 1252 Hearing dates: 2 - 6 and 10 - 11 June 2014 Decision date: 12 September 2014 Jurisdiction: Equity Division Before: Black J Decision: Parties to be heard as to orders that ought to be made to give effect to findings in the judgment. Catchwords: CONTRACTS - construction - where parties entered into contract for sale of non-exclusive "interest" in software - nature of "interest" acquired by first plaintiff - whether interest was limited to software which existed at relevant date - whether first defendant owned copyright in software to exclusion of second defendant - whether first plaintiff was limited to licensing software to particular customer - whether first defendant had express or implied obligation to provide first plaintiff with source code and updates for, and modifications and developments to, software - whether initial contract was abandoned by parties. CONTRACTS - construction - where relevant parties entered into subsequent contract in respect of software - scope of licence granted under contract - whether licence was limited to specified period - whether second plaintiff was permitted to grant licences to new customers after that period - effectiveness of assignment - whether second defendant required to provide updates to second plaintiff to ensure software compatibility with other software. CONTRACTS - breach - whether parties had breached obligation to deposit source code with escrow agent - whether conditions of agreement for release of software from escrow were satisfied - whether second defendant breached obligations to provide development services, information and assistance - confidentiality - whether second defendant had received and disclosed confidential information - good faith and cooperation - whether there was a breach of obligation of good faith. CONTRACTS - termination - whether second defendant had properly terminated agreement - whether established that second plaintiff breached contract by non-payment of licence fees - whether second defendant had abandoned rights to termination - whether notice of termination of agreement was effectively served - whether there was a failure by second defendant to comply with dispute resolution clauses - whether termination was invalidated by non-compliance with dispute resolution clauses. CONTRACTS - existence of contract - whether established that entity was granting licences under previous agreement - where person is director of two associated companies - whether sub-licence was created by decision of common director. TORTS - tort of conspiracy - harm by unlawful means - where second and third defendants had entered into purchase agreement - where defendants had terminated earlier agreement - whether established that conduct constituted a tort of conspiracy - whether conduct was unlawful - whether established that a purpose of conduct was to harm second plaintiff - whether established that second plaintiff has suffered loss or damage caused by conduct. TORTS - tort of inducing breach of contract - whether conduct constituted breach of earlier agreement - whether third defendant induced or procured second defendant to engage in conduct - whether third defendant had sufficient knowledge of terms of previous agreement - whether third defendant had requisite intention for second defendant to breach the previous agreement. TRADE PRACTICES - misleading or deceptive conduct - where representations were made on website registered to company not party to proceedings - whether third defendant engaged in trade or commerce between Australia and another country - whether third defendant engaged in conduct involving the use of telegraphic or telephonic services - whether established that representations were made by third defendant - whether representations were misleading or deceptive or likely to mislead or deceive. TRADE PRACTICES - unconscionable conduct - whether second and third defendants are corporations engaged in trade or commerce - whether plaintiffs were under a special disadvantage known to second and third defendants - whether second and third defendants unconscientiously took advantage of plaintiffs' special disadvantage - whether second and third defendants were engaged in conduct in connection with supply or possible supply of goods or services - whether second and third defendants engaged in unconscionable conduct under Australian Consumer Law ss 20 and 21. INTELLECTUAL PROPERTY - copyright - groundless threats of legal proceedings - whether third defendant made threats in respect of infringement of copyright - whether statements constituted groundless threats of copyright infringement. WORDS AND PHRASES - "interest", "customer". INTELLECTUAL PROPERTY - copyright - original works in which copyright subsists - whether copyright subsists in each update or new release of software and user documentation - whether first cross-claimant owned copyright in software releases in relevant periods. INTELLECTUAL PROPERTY - copyright - infringement - whether third cross-defendant infringed copyright in software - whether first, second and fourth cross-defendants had authorised alleged copyright infringement - liability of director of cross-defendants - whether cross-claimants are estopped from bringing an action for infringement of copyright - whether additional damages should be awarded under Copyright Act 1968 (Cth) s 115(4). TRADE PRACTICES - misleading or deceptive conduct - whether established that alleged representations were made by first, second and third cross-defendants - whether representations were misleading or deceptive or likely to mislead or deceive - whether cross-claimants had relied on alleged representations - whether established that loss and damage suffered by cross-claimants was caused by representations - accessorial liability - application of Australian Consumer Law ss 18 and 29. EQUITY - breach of confidentiality - whether information in licence key generator is property - whether information is confidential - whether second and third cross-defendants owed an obligation of confidentiality to cross-claimants - whether second and third cross-defendants breached obligation of confidence. INTELLECTUAL PROPERTY - trade marks - infringement - where third cross-defendant had used phrase on website - whether first cross-claimant has standing to bring claim - whether cross-claimant is entitled to be registered as owner of registered trade mark - whether conduct of cross-defendants constituted trade mark infringement - whether cross-defendants are liable for additional damages. Legislation Cited: - Australian Consumer Law ss 2, 18, 20, 21, 21(2), 21(5), 21(6), 29(g), 29(h), 151(g), 151(h), 236 - Competition and Consumer Act 2010 (Cth) s 6(2)(a)(i), 6(3)(a), 131, 163(4), Sch 2 - Competition and Consumer Legislation Amendment Act 2011 (Cth) - Conveyancing Act 1919 (NSW) s 12 - Copyright Act 1968 (Cth) ss 10, 15, 31, 31(1)(a)(vi), 32, 35(2), 35(6), 36(1), 36(1A), 43B, 115, 115(4), 115(4)(b)(i), 115(4)(b)(ia), 115(4)(b)(ib), 115(4)(b)(iii), 115(4)(b)(iv), 129, 196, 196(2), 196(4),197, 202 - Designs Act 1906 (Cth) ss 19(2), 19(3) - Evidence Act 1995 (NSW) s 140 - Trade Marks Act 1995 (Cth) ss 8, 17, 27(2), 88, 120, 120(1), 122(1)(b) Cases Cited: - Adler v Australian Securities and Investments Commission [2003] NSWCA 131; (2003) 179 FLR 1 - Al Jadeed TV v United Broadcasting International Pty Ltd [2011] FCA 983; (2011) 283 ALR 205 - Allstate Life Insurance Co v Australia & New Zealand Banking Group Ltd (1995) 58 FCR 26; (1995) 130 ALR 469 - Amalgamated Mining Services Pty Ltd v Warman International Ltd (1992) 111 ALR 269; (1992) 24 IPR 461 - AMP Financial Planning Pty Ltd v CGU Insurance Ltd [2004] FCA 1330; (2004) 139 FCR 223 - Antocks Lairn Ltd v I Bloohn Ltd [1971] FSR 490; [1972] RPC 219 - Aristocrat Technologies Australia Pty Ltd v DAP Services (Kempsey) Pty Ltd (in liq) [2007] FCAFC 40; (2007) 157 FCR 564 - Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd [2013] FCA 986; (2013) 102 IPR 400 - Armagas Ltd v Mundogas SA [1985] 1 Ll R 1 - Australasian Performing Rights Association Ltd v Valamo Pty Ltd (1990) 18 IPR 216 - Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99 - Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd [2001] HCA 63; (2001) 208 CLR 199 - Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd [2003] HCA 18; (2003) 214 CLR 51 - Australian Competition and Consumer Commission v Samton Holdings Pty Ltd [2002] FCAFC 4; (2002) 117 FCR 301 - Australian Competition and Consumer Commission v SensaSlim Australia Pty Ltd (in liq) (No 5) [2014] FCA 340; (2014) 98 ACSR 347 - Australian Securities and Investments Commission v National Exchange Pty Ltd [2005] FCAFC 226; (2005) 148 FCR 132 - Autodesk Inc v Yee (1996) 68 FCR 391; 139 ALR 735 - Avel Pty Ltd v Multicoin Amusements Pty Ltd [1990] HCA 58; (1990) 171 CLR 88 - Ballard v Multiplex [2012] NSWSC 426 - Beck v Montana Constructions Pty Ltd [1964-5] NSWR 229 - BP Refinery (Westernport) Pty Ltd v Hastings Shire (1994) 180 CLR 266 - Bulun Bulun v R & T Textiles Pty Ltd (1998) 86 FCR 244; 157 ALR 193 - Burger King Corporation v Hungry Jack's Pty Ltd [2001] NSWCA 187; (2001) 69 NSWLR 558 - Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; (2004) 218 CLR 592 - Byrne v Australian Airlines Ltd [1995] HCA 24; (1995) 185 CLR 410 - C Evans & Sons Ltd v Spritebrand Ltd [1985] 1 WLR 317; 2 All ER 415 - Camden v McKenzie [2007] QCA 136; [2008] 1 Qd R 39 - Carlow Castle Pty Ltd t/as Greenhill Capital Partners v Aztec Resources Ltd [2014] NSWCA 123 - CBS Records Australia Ltd v Gross (1989) 15 IPR 385 - CGM Investments Pty Ltd v Chelliah [2003] FCA 79; (2003) 196 ALR 548 - Coca-Cola Company v All-Fect Distributors Ltd [1999] FCA 1721; (1999) 96 FCR 107 - Codelfa Construction Pty Ltd v State Rail Authority of New South Wales [1982] HCA 24; (1982) 149 CLR 337 - Comdox No 24 Pty Ltd v Robins [2009] NSWSC 367 - Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447 - Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394 - Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd [2006] HCA 55; (2006) 229 CLR 577 - Copyright Agency Ltd v New South Wales [2008] HCA 35; (2008) 233 CLR 279 - Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184 - Council of the City of Sydney v Goldspar Australia Pty Ltd [2006] FCA 472; (2006) 230 ALR 437 - Cowell v Rosehill Racecourse Co Ltd [1937] HCA 17; (1937) 56 CLR 605 - Craig v Silverbrook [2013] NSWSC 1687 - Credit Connect v Carney [2010] NSWSC 910 - Cummins v Vella [2002] FCAFC 218 - Daly v Sydney Stock Exchange Ltd [1986] HCA 25; (1986) 160 CLR 371 - Danthanarayana v Commonwealth of Australia [2014] FCA 552 - DC Thomson & Co Ltd v Deakin [1952] Ch 646; [1952] 2 All ER 361 - Del Casale v Artedomus (Aust) Pty Ltd [2007] NSWCA 172; (2007) 73 IPR 326 - Dresna Pty Ltd v Misu Nominees Pty Ltd [2004] FCAFC 169; - DTR Nominees Pty Ltd v Mona Homes Pty Ltd [1978] HCA 12; (1977-1978) 138 CLR 423 - Dynamic Supplies Pty Ltd v Tonnex International Pty Ltd (No 3) [2014] FCA 909 - E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15; (2010) 241 CLR 144 - Electricity Generation Corporation (t/as Verve Energy) v Woodside Energy Ltd [2014] HCA 7; (2014) 306 ALR 25 - Fabig v Photon Group [2010] NSWSC 358 - Facton Ltd v Rifai Fashions Pty Ltd [2012] FCAFC 9; (2012) 199 FCR 569 - Fairfax Media Publications Pty Ltd v Reed International Books Australia Pty Ltd [2010] FCA 984; (2010) 189 FCR 109 - Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 - Fazio v Fazio [2012] WASCA 72 - Fightvision Pty Ltd v Onisforou [1999] NSWCA 323; (1999) 47 NSWLR 473 - Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420 - Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; (2009) 76 NSWLR 603 - Freier v Australian Postal Corporation (No 2) [2012] NSWSC 61 - Gardex Ltd v Sorata Ltd [1986] RPC 623 - Gram Engineering Pty Ltd v Bluescope Steel Ltd [2013] FCA 508; (2013) 106 IPR 1 - Heydon v NRMA Ltd [2000] NSWCA 374; (2000) 51 NSWLR 1 - Hightime Investments Pty Ltd v Adamus Resources Ltd [2012] WASC 295 - Hospitality Group Pty Ltd v Australian Rugby Union Ltd [2001] FCA 1040; (2001) 110 FCR 157 - Iacullo v Hillam [2014] NSWSC 1021 - IceTV Pty Ltd v Nine Network Australia Pty Ltd [2009] HCA 14; (2009) 239 CLR 458 - Insight Oceania Pty Ltd v Philips Electronics Australia Ltd [2008] NSWSC 710 - Interlego AG v Croner Trading Pty Ltd (1992) 39 FCR 348; 111 ALR 577 - Interlego AG v Tyco Industries Inc [1989] AC 217 - Johnson v Brightstars Holding Company Pty Ltd [2014] NSWCA 150 - Johnson & Johnson Aust Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326; 101 ALR 700 - Kalamazoo Australia Pty Ltd v Compact Business Systems Pty Ltd (1985) 84 FLR 101; 5 IPR 213 - Keller v LED Technologies Pty Ltd [2010] FCAFC 55; (2010) 185 FCR 449 - King v Milpurrurru (1996) 66 FCR 474; 136 ALR 327 - LED Builders Pty Ltd v Masterton Homes (NSW) Pty Ltd (1994) 54 FCR 196; 30 IPR 447 - Macmillan & Co Ltd v Cooper (1924) 40 TLR 186 - Mainteck Services Pty Ltd v Stein Heurtey SA [2014] NSWCA 184 - McCann v Switzerland Insurance Australia Ltd [2000] HCA 65; (2000) 203 CLR 579 - McKernan v Fraser [1931] HCA 54; (1931) 46 CLR 343 - Medical Benefits Fund of Australia Ltd v Cassidy [2003] FCAFC 289; (2003) 135 FCR 1 - Mentmore Manufacturing Co Ltd v National Merchandising Manufacturing Co Inc (1978) 89 DLR (3d) 195 - Microsoft Corp v Auschina Polaris (1996) 71 FCR 231; 142 ALR 111 - National Rugby League Investments Pty Ltd v Singtel Optus Pty Ltd [2012] FCAFC 59; (2012) 201 FCR 147 - Nature's Blend Pty Ltd v Nestle Australia Ltd [2010] FCAFC 117; (2010) 272 ALR 487 - Onesteel Manufacturing Pty Ltd v BlueScope Steel (AIS) Pty Ltd [2013] NSWCA 27 - Oren v Red Box Toy Factory Ltd [1999] FSR 785 - Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd [2006] FCAFC 40; (2006) 149 FCR 395 - Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd [2005] FCA 288 - Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; (2004) 218 CLR 451 - Pacific Film Laboratories v Commissioner of Taxation [1970] HCA 36; (1970) 121 CLR 154 - Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191 - Pepsico Australia Pty Ltd (t/as Frito-Lay Australia) v Kettle Chip Co Pty Ltd (1996) 135 ALR 192; 33 IPR 161 - Performing Right Society Ltd v Ciryl Theatrical Syndicate Ltd [1924] 1 KB 1 - Polygram Pty Ltd v Golden Additions Pty Ltd (1997) 76 FCR 565; 148 ALR 4 - Rafferty v Madgwicks [2012] FCAFC 37; (2012) 203 FCR 1 - Rainham Chemical Works Ltd (in liq) v Belvedere Fish Guano Co Ltd [1921] 2 AC 465 - Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 - Re Colorado Products Pty Ltd (in prov liq) [2014] NSWSC 789 - Roadshow Films Pty Ltd v iiNet Ltd [2012] HCA 16; (2012) 248 CLR 42 - RPR Maintenance Pty Ltd v Marmax Investments Pty Ltd [2014] FCA 409 - Sharjade Pty Ltd v the Commonwealth of Australia [2009] NSWCA 373 - Societe d'Avances Commerciales (Societe Anonyme Egyptienne) v Merchants' Marine Insurance Co (The "Palitana") [1924] 20 Ll L Rep 140 - South State Food & Beverage Pty Ltd v Kaur [2005] FCA 587 - State of New South Wales v Hunt [2014] NSWCA 47 - Stratton Finance Pty Ltd v Webb [2014] FCAFC 110 - Summers v The Commonwealth [1918] HCA 33; (1918) 25 CLR 144 - Taco Co of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 - Telmak Teleproducts (Aust) Pty Ltd v Bond International Pty Ltd (1985) 66 ALR 118; 5 IPR 203 - Telstra Corp Ltd v Phone Directories Co Pty Ltd [2010] FCAFC 149; (2010) 194 FCR 142 - Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 - Tonto Home Loans Australia Pty Ltd v Tavares [2011] NSWCA 389 - Tresedar Pty Ltd v Property Builders (Constructions) Pty Ltd (in liq) [2014] NSWSC 382 - Tricontinental Corporation Ltd v HDFI Ltd (1990) 21 NSWLR 689 - United Group Rail Services Ltd v Rail Corporation (NSW) [2009] NSWCA 177; (2009) 74 NSWLR 618 - Vodafone Pacific Ltd v Mobile Innovations Ltd [2004] NSWCA 15 - Wah Tat Bank Ltd v Chan Cheng Kum [1975] AC 507; 2 All ER 257 - White Horse Distillers Ltd v Gregson Associates Ltd [1984] RPC 61 - Williams v Hursey [1959] HCA 51; (1959) 103 CLR 30 - Yorke v Lucas [1985] HCA 65; [1985] HCA 65 - Young Investments Group Pty Ltd v Mann [2012] FCAFC 107; (2012) 293 ALR 537 Texts Cited: - B Hoffmann and R Dias, "20 years on from Renard Constructions - is the contractual duty of good faith any clearer?" (2012) 24 Australian Construction Law Bulletin 23 - J Allsop, "Good faith and Australian contract law: A practical issue and a question of theory and principle" (2011) 85 Australian Law Journal 341 - JW Carter, E Peden & G Tolhurst, Contract Law in Australia, (5th ed 2007, LexisNexis Butterworths) - JW Carter, Breach of Contract, (2011, LexisNexis Butterworths) - R McDougall, "The Implied Duty of Good Faith in Australian Contract Law" (2006) 108 Australian Construction Law Newsletter 280 - N Seddon and MP Ellinghaus, Cheshire and Fifoot's Law of Contract, (9th Australian ed 2008, LexisNexis Butterworths) Category: Principal judgment Parties: JR Consulting & Drafting Pty Ltd (First Plaintiff/First Cross-Defendant) Hayes Steel Framing Systems Pty Ltd (Second Plaintiff/Second Cross-Defendant) Robert Cummings (First Defendant) Tanmari Pty Ltd (Second Defendant/Second Cross-Claimant) FrameCAD IP Ltd (Third Defendant/First Cross-Claimant) Steel Framing Systems International Pty Ltd (Third Cross-Defendant) Gianni Pacione (otherwise known as John Pacione) (Fourth Cross-Defendant) FrameCAD Ltd (Fifth Cross-Defendant) Representation: Counsel: G Sirtes SC/T Catanzariti (Plaintiffs/First to Fourth Cross-Defendants) S J Goddard SC/S L Ross (Defendants/Cross-Claimants) Solicitors: Simone Legal (Plaintiffs/First to Fourth Cross-Defendants) Sparke Helmore (Defendants/Cross-Claimants) File Number(s): 2012/282948 Judgment 1These proceedings relate to the ownership and control of software known as Quik Series Software ("QSS"), which is used in the design and manufacture of cold form metal light gauge wall frames, trusses, flooring and roofing used in the construction of residential and commercial buildings. 2The First Plaintiff, JR Consulting & Drafting Pty Ltd ("JRC"), is a company associated with Mr John Pacione. The Second Plaintiff, Hayes Steel Framing Systems Pty Ltd ("HSFS"), is also now a company associated with Mr Pacione. HSFS was incorporated on 3 February 2003 and Bradbury International Inc ("Bradbury International"), which is a manufacturer of roll forming machines, then held an 80% interest and JRC a 20% interest (Pacione 26.10.12 [34]); Cummings 14.10.13 [72.2]). Bradbury International was also the owner of Hayes International Ltd (a New Zealand company), which supplied rollforming machines manufactured in New Zealand. A Shareholders Agreement between Bradbury International and JRC was executed in March 2004 (Pacione 19.3.14 [77]). HSFS has been a wholly-owned subsidiary of JRC since 30 September 2008 (Pacione 19.3.14 [186]). A third entity, Steel Framing Systems International Pty Ltd ("SFSI") (which was previously known as SFS Australia Pty Ltd and changed its name on or about 8 December 2008 (T69)), is also a wholly-owned subsidiary of JRC, and Mr Pacione is a director of JRC, HSFS and SFSI. An earlier version of the Statement of Claim (Statement of Claim 26.10.12 [37]) pleaded that, after its authorisation to use QSS, SFSI acted as the agent of both JRC and HSFS and no leave was sought to withdraw that admission. 3JRC and HSFS conducted and SFSI now conducts (at least in respect of new clients) a business supplying equipment to manufacture steel frame structures for residential and commercial construction and associated software. Mr Pacione described the Plaintiffs' business as follows: "The Plaintiffs are in the business of designing and supplying manufacture systems for light gauge steel framing, utilising and integrating computer aided design software ("CAD"), computer aided manufacturing software ("CAM"), machinery and engineering data for the manufacture of light gauge steel wall panels, roof trusses and floors, typically used in residential, commercial and industrial buildings. As part of that work both Plaintiffs licence various software programs to their customers, including CAD software" (Pacione 26.10.12 [6]). That evidence requires qualification to the extent that new business has for a significant time been undertaken, at least in respect of new clients, not by the Plaintiffs but by SFSI. 4The First Defendant is Mr Robert Cummings, who developed QSS. The Second Defendant, Tanmari Pty Ltd ("Tanmari"), was incorporated on 11 November 2003 and is controlled by Mr Cummings and took over his business (Cummings 14.10.13 [72], [76]). On 2 November 2011, Tanmari and Mr Cummings assigned their rights in QSS to the Third Defendant, FrameCAD IP Ltd ("FIPL"). 5Mr Cummings' ownership of the relevant copyright is accepted in both parties' pleadings. Paragraphs 4 and 7 of the Plaintiffs' Amended Statement of Claim relevantly plead that: "4. [Mr Cummings] was the author and the original owner of copyright in the QSS Application. 7 At all material times: (a) copyright subsisted in the QSS Application; and (b) [Mr Cummings] was the first owner of copyright in the QSS Application and would be the owner of copyright in any updates to the QSS Application when the copyright came into existence." The term "QSS Application" is defined in paragraph 3 of the Amended Statement of Claim as a suite of computer programs known as Quik Series Software. Paragraph 7 of the Amended Statement of Claim is in turn particularised by a statement that the QSS Application and each of the computer programs was a literary work and that Mr Cummings was the author of that application and at the relevant time the updates to that application. The Defendants adopt the same position in pleading that copyright subsists in QSS as an original literary work (or works) under s 10 of the Copyright Act 1968 (Cth) and that Mr Cummings is and was at all material times the author of the computer programs (source code) for the purposes of s 35(2) of the Copyright Act. By paragraphs 1 and 2 of their Defence to the Cross-Claim, the Plaintiffs also admit that Mr Cummings made QSS and end user manuals and other documentation for use with QSS and updates and new releases of QSS and user documentation. These statements are an essential aspect of the Plaintiffs' claims. 6Substantial evidence was led as to the history and functionality of QSS. By about 1996 or 1997, QSS included data files and software and was able to operate with rollforming machines, and included a computer numeric control file to permit the transfer of instructions between a computer and a roll form machine which contained the details necessary to produce the relevant steel item (Cummings 4.12.12 [16]-[21]), tables to calculate the placement of each structure in the relevant steel framework (Cummings 4.12.12 [24]) and "look-up" tables or data files containing the dimensions and other relevant information for each steel item within that framework (Cummings 4.12.12 [24]). Several user manuals in respect of the software and its applications are in evidence. After a user selects the relevant module which it wishes to use, the user can enter settings for, for example, applicable design standards and other information, and QSS is then used with third party computer aided design ("CAD") software to draw the roof, walls or floors, as the case may be, in layout form on the computer screen. The QSS software in turn applies the user's settings to that drawing to generate a drawing in elevation form and information about that drawing, and generates a file containing data that will be used to manufacture the relevant steel items. 7From about 2002, JRC and later HSFS used (and, so far as new business is concerned, SFSI now uses) QSS software as one of several items used for the design and manufacture of steel framing. These include engineering tables and manuals in book and electronic form; computer aided manufacture software which reads the data file generated by QSS and prepares the relevant data for manufacturing; machine control software known as "frameware" that is used by the operator of the roll-form machinery to manufacture steel framing components from that data; and roll-form machinery which is controlled by the frameware. 8The QSS software works together with CAD software, including software referred to as "IntelliCAD". That software is controlled by the IntelliCAD Technology Consortium, which is a group of third parties who use and license IntelliCAD and grants members the right to use and sub-license IntelliCAD and provides access to source code and technical support. There is an issue in these proceedings as to the impact of updates to IntelliCad on the use of the QSS software by the Plaintiffs. For a period, the IntelliCAD Technology Consortium had introduced a rule restricting its members from selling or marketing software programs that operated with earlier rather than current IntelliCAD code. 9By orders made by Bergin CJ in Eq on 19 July 2013, questions of liability and quantum were separated, so that this aspect of the proceedings deals only with the question of liability. Each party relied on lengthy affidavits and made numerous objections, many of which were justified, to the admissibility of affidavit evidence of the other parties. Happily, many of the objections were resolved by agreement between Counsel and large parts of the affidavit evidence were not read. The Plaintiffs identified numerous issues to be determined in the proceedings, involving 40 issues in respect of the primary claim and 34 issues in respect of the Cross-Claim That list of issues, although elaborate, is of assistance in identifying the matters to be determined in the proceedings. Those issues can conveniently be grouped, as the Plaintiffs did in their lists of issues, into several categories. I will refer to those issues in addressing particular questions below. A brief chronology of events 10I should now outline several of the key events and agreements although I will refer to the terms of those agreements in greater detail below. 11Mr Cummings and JRC entered into a Deed of Agreement date 28 July 2002 ("2002 Agreement") for the sale of a non-exclusive "interest" in respect of the QSS software. The matters in dispute between the parties include the nature of the right or interest sold under the 2002 Agreement; whether the 2002 Agreement was replaced or superseded by later licences granted to HSFS; and whether any licence under the 2002 Agreement was revoked or otherwise came to an end. 12An agreement was entered into in July 2003 between HSFS, Mr Cummings and NBR (Australia) Pty Ltd ("NBR"), a company associated with a consulting engineer, Mr Nicholas Roulant (Ex P2, 48), by which Mr Cummings granted a software licence to HSFS which authorised HSFS to grant sub-licences of QSS (Pacione 26.10.12 [35], Ex P7, 3/143-158) ("Stramit Agreement"). The Defendants contend that, from July 2003, HSFS replaced JRC as the licensee of QSS with the right to grant sub-licences. 13On 25 February 2004, Mr Cummings and Tanmari granted HSFS an exclusive licence, inter alia, to "use and exploit" QSS for the territory of Australia ("Exclusivity Agreement") (Pacione 26.10.12 [41], Ex P7, 3/185-199; Cummings 4.12.12 [87]). The Exclusivity Agreement was executed in the context of discussions between HSFS and Stramit, a customer, to provide it with exclusivity, which ended in about July 2004. The Defendants accept, in substance, that this included a licence of the copyright in QSS. The parties terminated the Exclusivity Agreement on 22 February 2005 with effect from 31 March 2005 (Pacione 26.10.12 [49], Ex P7, 3/232; Cummings 4.12.12 [104]-[105]). 14By an undated letter on the letterhead of QSS, sent by Mr Cummings on 1 March 2004 (Ex P2, 79), Mr Cummings stated as follows: "To whom it may concern: This is to certify that [JRC] have been given non exclusive rights to on sell Quick Series Software as defined under the "Deed of Agreement" dated 28thth [sic] July 2002. While not explicitly stated in this agreement, [JRC] has also been granted a non-exclusive right to market Quik Series Software under the HayesCAD banner." 15At one point in cross-examination, Mr Pacione suggested that the rights held by HSFS arose from a technology licence from JRC, rather than from the 2004 Agreement. The Agreement headed "Technology Licence Agreement" between JRC, Mr Pacione and HSFS (Ex D2) was dated 12 March 2004 and recited that HSFS desired to acquire, and JRC and Mr Pacione desired to provide, a perpetual, royalty-free right to use "The Goods" and to grant sub-licences to them. The term "The Goods" was defined as a licence of the goods set out in Schedule 1 of the Agreement which referred, inter alia, to HayesCAD-QSS Version 11.231 and any other intellectual property subsequently licensed by JRC or Mr Pacione. Clause 2 of that agreement in turn provided that JRC and Mr Pacione licensed the irrevocable, worldwide, fully paid-up, royalty-free right and licence to use "the goods" as set out in that Schedule, with the right to grant sub-licences of the same scope to others, and represented and warranted that they had the right to license "The Goods" to HSFS under that agreement. That document was an annexure to the Shareholders Agreement between JRC and Bradbury International in respect of HSFS. That agreement was not given any substantial emphasis in the parties' pleadings or submissions. I do not consider that it had an overarching continuing operation, given the agreement subsequently entered between HSFS and Tanmari in August 2004 to which I refer below, which took effect as the basis of the parties' continuing relationship for the reasons noted below. 16A further agreement titled "QSS Software Licence Agreement" between HSFS and Tanmari ("2004 Agreement") was executed on 11 August 2004 (Pacione 26.10.12 [46], Ex P7, 3/205). A Development Agreement, pursuant to cl 4.1 of the 2004 Agreement, was also signed on that date (Pacione 26.10.12 [48], Ex P7, 3/220; Cummings 4.12.12 [98]). 17A memorandum of understanding was signed between Metal Forming Technology Ltd, a predecessor of FIPL, and Mr Cummings in September 2005 and there were further dealings and communications between FIPL and Mr Cummings in May 2006 (Taylor 31.10.13 [23]-[27]). 18SFSI was incorporated in October 2007. The Plaintiffs contend that, in 2009, JRC sub-licensed SFSI to use QSS and that SFSI in turn licensed the use of that software to a number of its customers under contracts between SFSI and those customers. 19Negotiations between Mr Cummings and FIPL for the sale of the interest in QSS to FIPL took place in mid-September 2011 (Taylor 31.10.13 [32]-[33]) and a Purchase Agreement ("FIPL Purchase Agreement") was executed on 31 October 2011 (Cummings 4.12.12 [33]; Taylor 31.10.13 [18]) and announced by FIPL in mid-November 2011 (Pacione 1.11.12 [13], Annexure "F"). The evidence of FIPL's chief executive, Mr Taylor, is that he first became aware of the terms of the 2004 Agreement on 18 November 2011, after the purchase of QSS had been completed (Taylor 31.10.13 [36]). 20In December 2011, Tanmari and FIPL gave notice of breaches under the 2004 Agreement, by reference to licences granted by HSFS and/or SFSI on which licence fees had not been paid. On 13 January 2012, HSFS issued a notice of dispute to Tanmari under the 2004 Agreement. On 24 January 2012, Tanmari purported to terminate the 2004 Agreement by letter from its solicitors to HSFS's solicitors. The witnesses 21There are significant differences between the accounts given by Mr Pacione and Mr Cummings of particular conversations and of some events. Both were giving evidence of events that occurred many years ago, including conversations at about the time of the entry into the 2002 Agreement, the 2004 Agreement and the time the relationship between them deteriorated prior to April 2009. Both gave affidavit evidence setting out the effect of conversations between them, although Mr Cummings fairly conceded the limits of his recollection in cross-examination. Although I make several observations as to the credit of witnesses below, many issues in the proceedings turn on the construction of written documents, in the context of surrounding circumstances that emerge from contemporaneous correspondence or inferences that can properly be drawn from objective facts. 22To the extent that credit issues need to be determined in respect of particular conversations, I have had regard to the fact that objective evidence is likely to be the most reliable basis for determining them. I summarised the relevant principles in Re Colorado Products Pty Ltd (in prov liq) [2014] NSWSC 789 at [10], where I noted that the credibility of a witness and his or her veracity may be tested by reference to the objective facts proved independently of the testimony given, in particular by reference to the documents in the case, by paying particular regard to his or her motives, and to the overall probabilities: Armagas Ltd v Mundogas SA [1985] 1 Ll R 1 at 57. I also referred to Atkin LJ's observation in Societe d'Avances Commerciales (Societe Anonyme Egyptienne) v Merchants' Marine Insurance Co (The "Palitana") [1924] 20 LI L Rep 140 at 152, recently cited by Sackar J in Craig v Silverbrook [2013] NSWSC 1687 at [141], that: "an ounce of intrinsic merit or demerit in the evidence, that is to say, the value of the comparison of evidence with known facts, is worth pounds of demeanour." In Camden v McKenzie [2007] QCA 136; [2008] 1 Qd R 39 at [34], Keane JA (as his Honour then was) similarly noted that: "[u]sually, the rational resolution of an issue involving the credibility of witnesses will require reference to, and analysis of, any evidence independent of the parties which is apt to cast light on the probabilities of the situation." That observation was recently cited with approval by Leeming JA (with whom Barrett JA and Tobias AJA agreed) in State of New South Wales v Hunt [2014] NSWCA 47 at [56]. 23I should, however, make several observations about the key witnesses. Mr Pacione's evidence was accurate and precise as to many issues including the technical aspects of his companies' business, and some aspects of it were supported by surrounding correspondence. He was plainly well-informed as to the issues in the Plaintiffs' case and it seemed to me that he sought to minimise the disclosure of matters that might be adverse to that case and would not make any concession that might be adverse to that case. His affidavit evidence verged on being misleading in respect of an important issue in the case, referring at length to the nature of the business of the Plaintiffs, JRC and HSFS, without acknowledging that HSFS had substantially ceased to conduct that business (in particular, ceasing to deal with new customers) in 2009 and that SFSI (which is not a Plaintiff) had, in effect, assumed its business. His evidence in cross-examination as to the nature of any continuing business of HSFS was contradictory, as he shifted positions as to the extent to which HSFS had conducted any business after that time. His attempt to avoid, in affidavit evidence, recognition of the confidentiality of the licence key generator supplied by Mr Cummings or Tanmari to JRC or HSFS was also implausible. 24The Plaintiffs make adverse credit submissions in respect of both Mr Cummings and Mr Taylor, and submit that their evidence ought not be accepted where it is uncorroborated by independent evidence. In particular, the Plaintiffs submit that the Court should not accept Mr Cummings' evidence in relation to the circumstances surrounding the entry of the 2002 Agreement; the scope of the 2002 Agreement; his knowledge of SFSI; or the extent of his involvement in the decision-making concerning the notification of alleged breaches and the purported termination of the 2004 Agreement. I have considered the detailed criticisms made of Mr Cummings' evidence and the examples that the Plaintiffs give of evidence which is said to be internally inconsistent, untrue or contradicted by other evidence. I do not consider that Mr Cummings' evidence that he understood the 2002 Agreement to be limited to Stratco, a customer of JRC, to be adverse to his credit. There was nothing implausible about such an understanding, given the context of the entry into that agreement, notwithstanding that subjective intention is not taken into account in contractual construction, by reason of the objective theory of contract. 25I accept that Mr Cummings' affidavit evidence may well have overstated the extent of his recollection of particular conversations and that there were occasions where Mr Cummings' evidence in cross-examination qualified his affidavit evidence. In some cases, that may be a matter adverse to a witness's credit. In this case, it reflected Mr Cummings' honest and direct answers to questions in cross-examination and his readiness to accept the limits of his recollection. Mr Cummings, without hesitation, conceded matters that were apparently adverse to his case, including the fact that he had withdrawn from engagement with Mr Pacione in the later part of the relevant period. I accept that (as the Plaintiffs contend) Mr Cummings cannot be treated by the Court as being independent of FIPL, where he is under a continuing retainer to provide services to FIPL. However, lack of independence is not the same as lack of honesty. I formed a generally favourable view of Mr Cummings' evidence, particularly in cross-examination. 26The Plaintiffs also submitted, with some justification, that Mr Taylor's evidence ought also be approached with circumspection. They submit, and I accept, that there were occasions on which he was evasive, as they put it, or at least reluctant to address questions that he considered might be adverse to FIPL's interests (for example, T355; T373-374) and there were points where he did not accept matters that obviously followed form his evidence, including that he was seeking to dissuade a third party, Golden Homes, from dealing with SFSI and to attract its business to FIPL in December 2011 (T366-367). Having said that, Mr Taylor's evidence was largely relevant to the question of FIPL's knowledge of the 2004 Agreement and its purposes in dealings with Mr Cummings, Tanmari and the Plaintiffs. So far as his and FIPL's knowledge of the 2004 Agreement, at the time FIPL entered the FIPL Purchase Agreement is concerned, his evidence is plausible and corroborated by Mr Cummings' evidence which I accept, and the objective evidence provides the strongest basis for findings as to the purposes of FIPL in respect of the relevant dealings with Mr Cummings, Tanmari and the Plaintiffs. I am not satisfied by one aspect of Mr Taylor's evidence as to FIPL's standing to bring a claim for trade mart infringement, to which I will refer below. The nature of the interest acquired by JRC under the 2002 Agreement (SOC [9]-[14]) (Plaintiffs' Issues 1, 5) 27I now turn to the substantive issues raised in the proceedings. The first and fifth issues identified by the Plaintiffs involve alternative characterisations of the rights acquired by JRC under the 2002 Agreement and raise substantially overlapping issues. The Plaintiffs relevantly plead: "10. Pursuant to the terms of the [2002 Agreement] [Mr Cummings] assigned to [JRC] an interest in copyright in the QSS Application including updates to QSS Application. 11. In the premises, [JRC] is an owner of an interest in copyright in the QSS Application and updates to the QSS application to non-exclusively use and sub-license the use of the QSS application in the development and use of [JRC's] steel frame manufacturing system." The Plaintiffs' primary contention is that, under the 2002 Agreement, JRC purchased a non-exclusive interest in the copyright in QSS, which does not limit Mr Cummings' ownership or ability to use and sell QSS. The Plaintiffs contend that the 2002 Agreement is ongoing and was not open to unilateral termination, so far as it was a purchase agreement and rights vested in JRC without time limitation. 28The Plaintiffs alternatively contend that the 2002 Agreement grants JRC a non-exclusive licence to QSS. Paragraph 12 of the Plaintiffs' Amended Statement of Claim relevantly pleads that: "12. Further, and in the alternative, on or about 28 July 2002 [Mr Cummings] granted [JRC] a non-exclusive licence in the QSS Application to use and sub-licence the use of the QSS Application in [JRC's] steel framing manufacturing system." This pleading is particularised by reference to recitals B and C and clause 2 of the 2002 Agreement. The Plaintiffs submit that, if the 2002 Agreement does not assign JRC a non-exclusive interest in QSS (and, implicitly, in the copyright constituting that application), then that agreement grants JRC a non-exclusive licence of the copyright in QSS and is not a mere right to resell QSS without any copyright rights. I will address that contention below. 29It is common ground that the 2002 Agreement must be construed objectively. I have had regard to well-established principles as to the manner in which commercial contracts should be interpreted. In Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99 at 109, Gibbs J (as his Honour then was) observed that: "It is trite law that the primary duty of a court in construing a written contract is to endeavour to discover the intention of the parties from the words of the instrument in which the contract is embodied. Of course the whole of the instrument has to be considered, since the meaning of any one part of it may be revealed by other parts, and the words of every clause must if possible be construed so as to render them all harmonious one with another. If the words used are unambiguous the court must give effect to them, notwithstanding that the result may appear capricious or unreasonable, and notwithstanding that it may be guessed or suspected that the parties intended something different. The court has no power to remake or amend a contract for the purpose of avoiding a result which is considered to be inconvenient or unjust. On the other hand, if the language is open to two constructions, that will be preferred which will avoid consequences which appear to be capricious, unreasonable, inconvenient or unjust." Attention must be given to the language used by the parties and the commercial circumstances that the document addresses and the objects that it is intended to secure: McCann v Switzerland Insurance Australia Ltd [2000] HCA 65; (2000) 203 CLR 579 at 589 [22] (per Gleeson CJ). In Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; (2004) 218 CLR 451 at [22], the High Court noted that: "The construction of commercial contracts is to be determined by what a reasonable person in the position of [the contracting party] would have understood them to mean (Gissing v Gissing [1971] AC 886 at 906; Christopher Hill Ltd v Ashington Piggeries Ltd [1972] AC 441 at 502; ABC v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540). That requires consideration, not only of the text of the documents, but also the surrounding circumstances known to the parties, and the purpose and object of the transaction (Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896; [1998] 1 All ER 98.) In Codelfa Construction Pty Ltd v State Rail Authority of NSW ((1982) 149 CLR 337 at 350. See further Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 76 ALJR 436 at 445 [39]; 186 ALR 289 at 301) ..." 30The Plaintiffs refer, uncontroversially, to the statement of the relevant principles in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 at [40], where the High Court observed (citations omitted): "It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction." The approach was confirmed in Electricity Generation Corporation (t/as Verve Energy) v Woodside Energy Ltd [2014] HCA 7; 306 ALR 25 at [35] where French CJ, Hayne, Crennan and Kiefel JJ observed that (citations omitted): "[T]his Court has reaffirmed the objective approach to be adopted in determining the rights and liabilities of parties to a contract. The meaning of the terms of a commercial contract is to be determined by what a reasonable businessperson would have understood those terms to mean. That approach is not unfamiliar. As reaffirmed, it will require consideration of the language used by the parties, the surrounding circumstances known to them and the commercial purpose or objects to be secured by the contract. Appreciation of the commercial purpose or objects is facilitated by an understanding 'of the genesis of the transaction, the background, the context [and] the market in which the parties are operating'. The Plaintiffs also point out that the Court must construe the words of the 2002 Agreement in the context of the surrounding circumstances and point to the Court of Appeal's decision in Mainteck Services Pty Ltd v Stein Heurtey SA [2014] NSWCA 184, where Leeming JA (with whom Ward and Emmett JJA agreed) observed (at [71]) that the mandatory words "will require consideration" in the passage from Electricity Generation Corporation above that I have quoted above require that the surrounding circumstances be considered to construe the meaning of the words of a contract in context. That view was in turn approved by the Full Court of the Federal Court in Stratton Finance Pty Ltd v Webb [2014] FACFC 110 at [40]. The relevant principles were summarised by Bergin CJ in Eq in Carlow Castle Pty Ltd t/as Greenhill Capital Partners v Aztec Resources Ltd [2014] NSWCA 123 at [70] (with whom Barrett JA agreed at [1]) as including, relevantly, that the meaning of words in a contract are to be determined objectively, with attention to be given to the language of the contract, the commercial circumstances the contract addresses, the purpose of the transaction and the objects intended to be secured by it. 31I also understand it to be common ground between the parties that the Court can have regard to the recitals to the 2002 Agreement as an aid to construction of the operative provisions of that agreement. The Plaintiffs point out that the recitals are a means by which the surrounding circumstances and purpose of the transaction can be ascertained: Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; (2009) 76 NSWLR 603 at [380] per Campbell JA. They also refer to Onesteel Manufacturing Pty Ltd v BlueScope Steel (AIS) Pty Ltd [2013] NSWCA 27; (2013) 85 NSWLR 1 at [63] where Allsop P (as his Honour then was) observed that: "The recitals to the agreement set out those aspects of the background that give explanation to the transaction. There may be other background facts, but the recitals reveal the background chosen by the parties by way of the identification of relevant context. The recitals can assist in interpretation of operative provisions, though they do not control the latter's operation when clear and unambiguous..." 32I should first address the events leading to the execution of the 2002 Agreement. Mr Pacione met Mr Cummings in about April 2002 and expressed interest in QSS. Mr Pacione was then conducting business through JRC and he and his wife were its sole directors and shareholders (Ex D9, Tab 10). Mr Pacione's evidence is that he came to know Mr Cummings, as the programmer of design software known as QSS, when he was seeking to develop a new CAD package for a project on behalf of a customer, Stratco. Mr Pacione's evidence is that he purchased a single user licence for QSS on 22 April 2002 (Pacione 26.10.12 [14]). 33Mr Cummings gives evidence of a conversation in early 2002 in which Mr Pacione requested him to give a demonstration of QSS to Stratco and that, in late April 2002 or early May 2002, he attended Stratco's site with Mr Pacione to give a demonstration of QSS (Cummings 4.12.12 [55]-[56]). Mr Pacione denies the conversation, or at least denies saying that Stratco wanted to use QSS (Pacione 28.1.13[11]). It is clear that Stratco did wish to use QSS, at least as a necessary part of the system to be supplied to it by JRC, and it seems to me likely that there would have been discussion of that matter so far as Mr Cummings was being asked to demonstrate the product to Stratco. Many of the disputed conversations as to this matter were ultimately not in issue, because the relevant paragraphs of Mr Cummings' affidavit related to the parties' intentions in respect of entry into the relevant contracts and were not read. 34Mr Pacione in turn refers, in his evidence in reply (Pacione 28.1.13 [12]), to a meeting with Mr Cummings in April 2002 where a discussion took place as follows: "Pacione: I am happy to pay to develop the software (QSS) so that I can use it in our System [sic] but I need to own it. It's not fair that I should pay for the development so that others can benefit. Cummings: As long as it's not exclusive, I don't mind. I won't sell exclusively, not unless we are talking about a lot of money. Pacione: It's fair that the things we are working on now, and paying for, are owned exclusively by me. Cummings: If you pay for it, you can have it, but that doesn't give you an exclusive right to the whole software package, just what you pay for. Pacione: OK, then we'll just separate that in the Agreement. Cummings: OK." This conversation seems to me to go to the parties' subjective intentions in entering the 2002 Agreement and it concludes with a reference to the fact that what was discussed would be reflected in the agreement. It seems to me to be of little utility, because it involved each party asserting its competing commercial objective, namely, Mr Pacione's objective to own what he paid for development of and Mr Cummings' unwillingness to sell the software package. The concept of "ownership" on a non-exclusive basis also has its own difficulties. 35Mr Pacione's evidence (Pacione 26.10.12 [20]) is that he handed the 2002 Agreement to Mr Cummings on 28 July 2002 at Mr Cummings' home office; Mr Cummings then read through the agreement; Mr Cummings then signed the agreement in the presence of his wife and Mr Pacione also signed it. Mr Cummings did not have legal advice in respect of the entry into the agreement. Mr Pacione's evidence is that, on 13 August 2002, Mr Cummings handed him a white labelled compact disk with the title "Quik Series Source Code for HayesCad and Stratco" and a copy of the disc and its label is in evidence (Pacione 26.10.12 [22]). Mr Pacione's evidence is that a discussion followed as to the provision of source code, in which Mr Cummings pointed out that any source code would be out of date with each new upgrade; Mr Pacione suggested that he could be given updated source code every year or so; and Mr Cummings responded in a manner that seems to me to have left open the question of any provision of future source code (Pacione 26.10.12 [23]). The relevant discussion was not, in any event, in a form that either involved an admission as to the terms of the 2002 Agreement or any separate contractual obligation. 36I will refer to the parties' submissions, before turning to a more detailed review of the terms of the 2002 Agreement. It is difficult to summarise those submissions in any simple way, because each submission was complex, and the issues became more complex as the parties often responded to the other party's submission by developing increasingly elaborate reformulations and variations of their respective submissions. The result was that the parties' submissions as to this issue had many individual points, both affirmatively and by way of rebuttal, but rather less by way of overall structure. The Plaintiffs submit that several textual indicators in the 2002 Agreement indicate that it amounted to an assignment of property in QSS (and, by extension, the copyright in QSS) to JRC rather than a licence. First, they point out that cl 2 of the 2002 Agreement uses "transfer", which they submit is a word of assignment. Second, they point out that cl 2 is headed "SALE" and there is no provision in the contract that prevents the Court from using the heading to construe the agreement. Third, they point out that Mr Cummings is described as "The Vendor" in the description of the parties. Fourth, they point out that the recitals to the 2002 Agreement use the words "acquiring interest" (in Recital B), "sale of an interest" (in Recital C) and "sells, assign and transfer ... right title and interest" (in Recital D) which they submit are also words of assignment. They also submit that the use of the word "interest" in the 2002 Agreement confirms that the agreement brings about an assignment rather than a licence, since a licence is a personal right and does not involve a proprietary interest: Cowell v Rosehill Racecourse Co Ltd [1937] HCA 17; (1937) 56 CLR 605. I do not consider that the matters to which the Plaintiffs refer lead to the inference which they seek to draw from them, since the 2002 Agreement was on any view at least the sale of property, namely, the compact disc containing the software, and the language of the agreement (including the characterisation of the transaction as a sale of "The Goods" to which I will refer below) is consistent with that matter. 37The Plaintiffs also contend that the other operative terms of the 2002 Agreement support a construction of it as an assignment of copyright, so far as JRC is given rights that are not generally given to a mere non-exclusive licensee of copyright such as a right to modify (in cl 5), which they contend is an incident of copyright under s 31(1)(a)(vi) of the Copyright Act, and a right to receive source code (in cl 6). I will address those clauses below. The Plaintiffs also point out that the 2002 Agreement expressly provides that the agreement does not prevent Mr Cummings from selling, assigning, transferring or licensing the QSS Application (Recital C) and contend that this would not be necessary if Mr Cummings had merely granted JRC a non-exclusive licence, because JRC as a non-exclusive licensee would have no expectation of restricting Mr Cummings' use of the software. I do not accept this submission. Even if an intellectual property lawyer might (or might not) have treated that matter as implicit in other aspects of the agreement, there would be no reason for the parties not to make that important matter clear even if the agreement was no more than a non-exclusive licence of the copyright or, as the Defendants submit, a right to sell physical copies of QSS only. 38The Plaintiffs also submit that the 2002 Agreement is an assignment of copyright in QSS even if QSS includes future copyright works. They do not admit that all updates and new releases of QSS constituted new copyright works, and I will address that issue below. However, they submit that, to the extent that updates and new releases constituted new copyright works, the assignment of a proprietary interest in QSS under the 2002 Agreement covered those works, because Mr Cummings is able to assign future copyright in future works under s 197 of the Copyright Act, provided that he would be the owner of the copyright on it coming into existence. This issue does not arise since, for the reasons set out below, I do not consider that the 2002 Agreement amounts to an assignment of the copyright in QSS to JRC. 39The Defendants submit, in their opening written submissions, that the licence granted to HSFS under the 2002 Agreement is a revocable licence of the kind identified in Cowell v Rosehill Racecourse Co Ltd above and was subsequently revoked. They submit that a "non-exclusive interest in copyright" is not recognised under the Copyright Act. The Plaintiffs in turn respond that the Copyright Act permits copyright to be assigned "in any way" under s 196(2) of the Copyright Act and recognises that a person may have an interest in copyright rather than own the whole of the copyright under s 196(4) of the Copyright Act. The Plaintiffs also respond that JRC's interest under the 2002 Agreement is not revocable because, if it did not acquire a proprietary interest in QSS, that licence was coupled with a proprietary interest that is also not revocable: Cowell v Rosehill Racecourse Ltd above. 40The Defendants submit, additionally or alternatively, that the 2002 Agreement is no more than a right to distribute, market or sell the software in the nature of distribution rights, although they accept that the agreement conferred on JRC either an implied licence to do whatever acts comprised in the copyright in QSS that were necessary for use by the customer of JRC or an express non-exclusive licence for JRC or its customer to do acts that were incidental to the use of the software. They submit that: "The 2002 Agreement is analogous to the sale of a Microsoft Office Software package. The purchaser gets title to the disks embodying the software. This is non-exclusive in that Microsoft can sell other disks embodying the software to other people, and a non-exclusive licence to use the software." The Defendants also submit, in oral submission, that the 2002 Agreement does not amount to a licence and involves a non-exclusive sale of an interest in physical goods and an implied licence to use the particular physical copy (T32). It does not seem to me that the terms of the agreement support so limited a reading of it which would, in particular, be inconsistent with the provisions dealing with modification and the provision of the source code for the software to which I have referred above. 41The Defendants in turn contend that the 2002 Agreement does not contain a clear grant of a right to reproduce the software or to do any other act comprised in the copyright for the purposes of s 31 of the Copyright Act and should be construed as granting no more than a right to distribute, market or sell the software, in the nature of distribution rights. They contend that there is a significant distinction between copyright and the property in the physical thing in which the copyright is embodied. They point out that copyright is an exclusive right as contemplated by ss 13, 26, 35, 115, 196 and 197 of the Copyright Act and that copyright is a species of personal property distinct from the property in goods that embody or reproduce the work or other subject-matter: Pacific Film Laboratories v Commissioner of Taxation [1970] HCA 36; (1970) 121 CLR 154 at 165-170 per Windeyer J. They contend that a right to sell or distribute QSS is in the nature of a distribution right, and that it is not a right to do an act comprised in the copyright: Avel Pty Ltd v Multicoin Amusements Pty Ltd [1990] HCA 58; (1990) 171 CLR 88 at 93-94 per Mason CJ, Deane and Gaudron JJ; 103 per Dawson J; and 116 per McHugh J. They submit that there is no right given under the 2002 Agreement to do any act comprised in the copyright, other than the implied right to do whatever acts comprised in the copyright were necessary to use the software. The Defendants also submit that the use of words such as "transfer of an interest" in the 2002 Agreement are not determinative and must be read together with the words "non-exclusive" in the context of the agreement as a whole. They also rely on Mr Cummings' evidence in cross-examination that it was not his intention to do anything other than grant a right to on-sell; however, evidence of subjective intention of this character is not admissible as to a question of contractual construction. 42The Plaintiffs respond that a reading of the 2002 Agreement as limited to a non-exclusive sale of an interest in physical goods and an implied licence to use the particular physical copy is not open on the pleadings, since the Defendants admitted that Mr Cummings had granted a non-exclusive licence to JRC to use QSS in the development and application of steel construction frame manufacturing systems when it was developed, in its version as it then existed (Defence [10(b)]). That paragraph reads as follows: "10 In response to the paragraph 10 of the Amended Statement of Claim, the Defendants: b admit that [Mr Cummings] granted a non-exclusive licence to [JRC] to use the 28 July 2002 Version for [JRC's] use in the development and application of steel construction frame manufacturing systems when it was developed, but that at the time of the [2002] Agreement, no such system existed." The Defendants' Cross-Claim also pleads that the purpose of the 2002 Agreement was to grant a non-exclusive licence in a steel frame manufacturing system when it was developed, limited to the then version of that software (Cross Claim [20(ii)(b)]). The Defendants did not seek leave to withdraw the admission involved in those pleadings and it does not seem to me open to them to advance the more limited position in submissions. In the event, the position taken in the Defence is consistent with the findings that I reach below as a matter of construction of the 2002 Agreement. 43The Plaintiffs also respond that, if the 2002 Agreement was only intended to sell the physical property in the compact disc comprising the software, the sale of the software could have been recorded in a one page invoice. While I accept that proposition, so far as it goes, it is of course possible that JRC and Mr Pacione (who proffered the relevant agreement) drafted a more complex document than was necessary. Mr Cummings was not legally represented in the transaction, and it would not be surprising that he would not then have realised that that document was unnecessarily complex, although he later took a position of that kind in declining to enter a separate agreement in respect of each acquisition of software for clients of JRC. 44The Plaintiffs point to surrounding circumstances in respect of the 2002 Agreement including that the subject of the 2002 Agreement is intangible property and that Mr Cummings is a software developer and not a manufacturer of physical items. They point out that Mr Cummings gave JRC one compact disc containing the QSS software (Pacione 26.10.12, Ex P7, 3/55) and also emailed JRC an electronic copy of the software (Pacione 26.10.12, Ex P7, 3/34). They contend that the only way that JRC can "use" QSS in the "application of steel construction frame manufacturing systems", as contemplated by Recital B of the 2002 Agreement, is if it can reproduce the electronic copy that Mr Cummings emailed to JRC. They also submit that, even if the 2002 Agreement was limited to a project with Stratco, which was its immediate context, there were at least two Stratco sites (Cummings 4.12.12 [70]). Mr Cummings in turn accepted in cross-examination that JRC could only on-sell QSS if he supplied further disks, and accepted that there was no arrangement or agreement to do so and that would be addressed by a "personal understanding" (T278). The Plaintiffs also submit that JRC's customers' use of QSS would necessarily involve the customer exercising copyright, since the software will necessarily involve a reproduction in material form on the customer's computer RAM. They point to an exception for temporary incidental reproduction made as a necessary part of the technical process of using a work, but that this only applies if the reproduction is made from a non-infringing copy, and submit that JRC must be in a position to provide its customer with a non-infringing copy of the software under s 43B of the Copyright Act. 45The Plaintiffs in turn seek to distinguish Avel Pty Ltd v Multicoin Amusements above, on which the Defendants rely as I noted above, as involving a distribution agreement for manufactured physical items, and contend that the subject of the 2002 Agreement is "the rights to" the software package, not the software package itself. The Plaintiffs also point out that the distribution agreement in issue in Avel Pty Ltd v Multicoin Amusements above referred to the rights "of distribution" (which is not one of a copyright owner's exclusive rights under s 31 of the Copyright Act) and did not expressly include any other rights, whereas the 2002 Agreement refers to the right to modify which is, as I noted above, a right of a copyright owner under s 31(a)(vi) of the Copyright Act. The Plaintiffs contend that a construction of the 2002 Agreement as relating to a sale of a physical item is inconsistent with cl 5 of that agreement which grants JRC the right to modify the software. 46The submissions to which I have referred above are, as this summary of them indicates, complex and sophisticated, although somewhat fragmented. Notwithstanding the sophistication of those arguments and the extent to which both parties have drawn on principles of intellectual property law - which were plainly not part of the surrounding circumstances known to both parties, where at least Mr Cummings was not legally represented in respect of the entry into the 2002 Agreement - it seems to me that the nature of the rights conferred by that agreement are to be determined primarily as a matter of the construction of its terms, to which I now turn. 47Recital A of the 2002 Agreement recorded that Mr Cummings was the developer and had copyright and proprietorship of "The Goods". That term was defined in cl 1.1 as: "A right to the Software Package referred to as Quik Series Software and includes Quik Roof, Quick [sic] Truss, Quik Frame and Quik Floor and also includes the Know How, methodology and trade secrets necessary for the implementation of "The Goods"." The focus in this definition is not on the intellectual property comprised in the software, but on the right to (implicitly, use) the software package, and that focus is emphasised by the reference to the "implementation" of "The Goods" at the end of the definition. Clause 1.2 in turn defines the term "The Material" which includes manuals and source codes. 48Recitals B and C in turn provide that: "B. [JRC] is desirous of acquiring an interest in "The Goods" for it's [sic] use in the development and application of steel construction frame manufacturing systems. C. This agreement is for the non-exclusive sale of an interest to "The Goods" to [JRC] and does not prevent [Robert Cummings & Associates] from selling, assigning, transferring or licensing "The Goods"." Essential incidents of ownership of the software are expressly reserved by Recital C to Mr Cummings, including the right to sell it or assign it to another person. Recital D in turn recites that Mr Cummings "sells, assigns and transfers" a "non-exclusive right, title and interest" to "The Goods" to JRC for the consideration of $25,000. That is, of course, not an operative provision and cannot expand the transaction contemplated by the operative provisions on their proper construction, although it is relevant to the construction of those provisions. Recital E refers to an amount of the consideration attributable to development of the software for JRC, which is dealt with in cl 4 of the 2002 Agreement. Mr Cummings subsequently invoiced JRC for that work. 49Clause 2 of the 2002 Agreement provides for Mr Cummings to "transfer" to JRC an interest in and right to "The Goods", as defined. Clauses 3 and 4 provide for JRC to pay the purchase price by a deposit of $7,500, a further amount of $15,000 on completion of additional development, and $7,500 on "installation/delivery of "The Goods'", as "full and final payment" for "The Goods". I interpolate that this clause suggests that the substance of the transaction was a sale of "The Goods" at a point in time, which would be completed on delivery of "The Goods" in this manner and payment of the balance due, and that provision casts light on Mr Cummings' obligations as set out in cl 6 to which I will refer below. 50Clause 5 of the 2002 Agreement dealt with further obligations by JRC and provides that: "[JRC] will consult and will give first option to [Robert Cummings & Associates] for any application, adaptation or modification of "The Goods", provided such consultation is supplied by [Robert Cummings & Associates] at standard and reasonable commercial rates. Any costs incurred for any application, modification of "The Goods" as instigated by [JRC] will be at the expense of [JRC]." The effect of the clause was that Mr Cummings had the first option for development work. It is implicit in that provision that the parties contemplated that a third party could undertake such applications, adaptations or modifications on JRC's behalf if Mr Cummings did not take up that option. Unless JRC had an implied licence to undertake development work in respect of the software, it would be exposed to the risk that Mr Cummings might not choose to provide those services, and it would not be able to further develop "The Goods" beyond applications, adaptations or modifications which could occur without infringement of Mr Cummings' copyright. 51Clause 6 of the 2002 Agreement in turn provides that: "Subject to Section 5, Instruction Manuals and staff training as required to establish an operational Software system as being used by an operator at any location required. All relevant "Materials" pertaining to the design and development of "The Goods", including functional specifications and source codes. The term "The Materials" used in this clause is in turn defined as "all books, manuals, specifications, programming source codes, instructions whether in a written or digitised form relating to "The Goods"". 52Clause 6 of the 2002 Agreement is plainly not well drafted, but appears to assume that there is an obligation by Mr Cummings to deliver or provide these materials. The Plaintiffs rely on this clause as imposing a continuing obligation on Mr Cummings. Any continuing obligation in respect of instruction manuals and staff training is expressly subject to cl 5 of the 2002 Agreement, which provides for the first option to Robert Cummings & Associates for the specified matters, and contemplates that they may be supplied at standard and reasonable commercial rates. So far as cl 5 of the 2002 Agreement is expressly framed as an option to Robert Cummings & Associates to supply the services, it does not seem to me that an obligation to do so can exist. I also do not read the second paragraph of cl 6 as imposing a continuing obligation. The "Materials" referred to are those that relate to the design and development of "The Goods" including functional specifications and source codes. It seems to me that the term "The Goods" refers to the software package that existed at the time of the 2002 Agreement, since there is nothing in the terms of the agreement that gives it an ambulatory operation in time, and the relevant "Materials" are therefore those which relate to the design and development of "The Goods" at the relevant time. The third paragraph of cl 6 in turn refers to complete and updated set-up disks as required to load "the latest, complete and operational version" of "The Goods". I similarly read that sentence as applying at the time of the relevant supply, so as to require at that time that the disks be complete and updated, and contain the latest, complete and an operational version of "The Goods". The concept of the supply of goods in turn seems to me to be consistent with a transaction that takes place at a point in time, at which property in "The Goods" is handed over. It seems to that that paragraph, read in that way, makes commercial sense, so far as it is read as ensuring that the version of "The Goods" acquired by JRC was both "complete" and "updated", in the sense of being up-to-date, at the time "The Goods" were acquired. In my view, clearer language would have been required to impose a further updating obligation continuing indefinitely after the supply of "The Goods" was completed, than is contained in that clause. 53Another significant contemporaneous indicator of the nature of the relevant transaction is the fact that the compact disk by which Mr Cummings supplied the relevant source code to JRC asserted copyright in QSS and that "all rights [were] reserved" by Mr Cummings and did not recognise any interest of JRC in the copyright, and JRC did not then assert such an interest or protest Mr Cummings' assertion of the ownership of the copyright which it now claims it had just bought. The absence of such an assertion seems to me to be relevant as part of the surrounding circumstances in respect of the 2002 Agreement and as an admission by JRC. 54It does not seem to me that the 2002 Agreement amounted to a sale of an interest in the copyright in QSS, where there is no focus upon the intellectual property in the terms of the 2002 Agreement and the commercial purpose of the transaction could be effected, consistent with the terms of that agreement, by the sale of the compact disc holding the software and the conferral of a right to use that software upon JRC. The transaction seems to me to have been, in substance, a sale of software together with a non-exclusive licence to use that software and, under cl 5 of the 2002 Agreement, to undertake permitted applications, adaptations and modifications of that software. 55I reach that conclusion based upon the terms of the 2002 Agreement and the contemporaneous circumstances and without reference to subsequent events. However, that the recitals of fact in, and terms of, subsequent agreements formed by the parties, which seem to me to be admissible so far as they give rise to admissions of fact against JRC and Mr Pacione, support that reading of the 2002 Agreement. It is well-recognised, of course, that post-contractual statements or conduct are not generally admissible to aid in the construction of a written contract: Agricultural and Rural Finance Pty Ltd v Gardiner [2008] HCA 57; 238 CLR 570 at [35] per Gummow, Hayne and Kieffel JJ; Johnson v Brightstars Holding Company Pty Ltd [2014] NSWCA 150 at [120] per Basten JA. However, post-contractual conduct may be admissible as an admission by one party as to the terms of a contract: Johnson v Brightstars Holding Company Pty Ltd above at [84] per Beazley P. Basten JA (with whom Gleeson JA agreed at [134]) also there observed at [121] that: "... where [subsequent conduct] provides evidence of facts, the assertion of which is against the interests of one party, it may be admissible as an admission by that party. However, to the extent that the evidence reveals an opinion as to a question of law rather than fact, the admission may be irrelevant or valueless. ... Alternatively, the evidence may establish contextual facts in existence at the time the contract was executed." I am conscious that the Plaintiffs submit that copyright ownership is a matter of law and an admission as to that matter is not admissible as a matter of contractual construction (Johnston v Brightstars above at [80], [81] per Beazley P) or would have little weight (Johnston v Brightstars above at [121] per Basten JA (with whom Gleeson JA agreed)). However, the identification of what was sold by the 2002 Agreement does not seem to involve the application of a legal standard so as to fall within that principle or to be primarily or substantially a matter to be determined by the application of copyright law. It also seems to me that, where JRC and HSFS were both under Mr Pacione's day-to-day control, I can also properly treat the position taken by HSFS (under Mr Pacione's management and control) as also indicating JRC's position (under Mr Pacione's management and control), at least in respect of these matters where there was no conflict in their respective interests. To put it another way, it is inconceivable that HSFS, by Mr Pacione, would conduct itself on the basis that Mr Cummings had exclusive ownership of the copyright in QSS unless JRC, by Mr Pacione, was also conducting itself on that basis. 56As I noted above, the Stramit Agreement (Ex P7, 3/143-158) was signed between Mr Cummings (trading as Robert Cummings & Associates), NBR and HSFS. Recital A provided that Mr Cummings "is the developer and has copyright and proprietorship of Quik Series Software". It seems to me that this recital is binding upon HSFS as an admission as to that matter, and is inconsistent with any suggestion that JRC then had any ownership interest, non-exclusive or otherwise, in the copyright in QSS. Recital C of the Stramit Agreement in turn provided that JRC: "has a non-exclusive right to the software package referred to as HayesCAD as referred to in "The Product" to be used in "The Project." That statement of a "non-exclusive right" is not an assertion of an ownership interest analogous to copyright in the software package. "The Product" is in turn defined as a "software program referred to as HayesCAD" and as including other "Quik Series Products" of which examples are given. "The Project" is defined as a request by Stramit to HSFS to develop, design, build and implement certain matters associated with a facility to manufacture steel wall panels and roof trusses. Recital E in turn provides that all payment for "The Product" is to be made to Mr Cummings and, in consideration of the payment by HSFS to Mr Cummings of a specified sum, Mr Cummings and NBR will supply "The Product". It would be surprising, to say the least, if HSFS were to choose to purchase from Mr Cummings a product that JRC owned and, on the case it now advances, was free to sub-license to HSFS on whatever terms it chose, without further payment to Mr Cummings. 57Clause 5(a) of the Stramit Agreement in turn provides that Mr Cummings will provide one site licence for the use of any QSS used to deliver the package known as HayesCAD. Clause 5(b) provides that HSFS will sub-license any software provided by Mr Cummings, and packaged with HayesCAD, only to Stramit. Clause 5(c) provides that: "All software used in the project will be referred to as HayesCAD, for simplicity, although it is agreed by all parties that parts of the total software package, in particular, the Quik Series Truss Analysis Function used in the project is the property of [Mr Cummings], and is subject to all licensing requirements as specified by [Mr Cummings]." It also seems to me that this clause, contained in an agreement signed by Mr Pacione on behalf of HSFS, is inconsistent with any assertion of an ownership interest in the copyright in QSS or in QSS as a software package by JRC. Clauses 5(d) and 5(e) in turn contemplate the issue of additional licences for the software package by Mr Cummings to HSFS. That approach also seems to be inconsistent with JRC then having an ownership of the copyright in QSS or an interest in the software package, which would have supported it sub-licensing the software package to HSFS without the need for Mr Cummings' involvement, as it claimed in later did in dealings with SFSI. Clause 7 of the Stramit Agreement deals with adaptations or modifications of "The Product", in similar form to the 2002 Agreement. The fact that such a provision is contained in the Stramit Agreement, which does not involve the sale of any interest in the software as distinct from a licence to use it, is consistent with the reading that I have given to the similar clause in respect of the 2002 Agreement. 58As I also noted above, on 25 February 2004, Mr Cummings and Tanmari granted HSFS an exclusive licence, inter alia, to "use and exploit" QSS for the territory of Australia under the Exclusivity Agreement (Pacione 26.10.12 [41], Ex P7, 3/185-199; Ex P2, 62). The Exclusivity Agreement was executed in the context of discussions between HSFS and Stramit to provide it with exclusivity, which ended about July 2004. Mr Pacione entered into those discussions in January 2004 relating to an exclusive arrangement for "the products under contract with [HSFS]" (Pacione 26.10.12 [39]). The reference to the "products" is presumably a reference to the suite of products used to manufacture the relevant steel products, and QSS was plainly within the scope of the discussion. 59The Defendants accept, in substance, that the Exclusivity Agreement conferred a licence of the copyright in QSS on HSFS. That Agreement recited, in Recital A, that Tanmari and Mr Cummings were the developer and had copyright and proprietorship of "The Licensed Goods". That recital is binding on HSFS, so far as it was party to the Exclusivity Agreement, and Mr Pacione also attested the affixation of HSFS's common seal to that agreement. Recital D records the agreement of the parties that the licence replaced any other agreement to use "The Licensed Goods" within the Territory. Recital E records HSFS's desire to license others to use "The Licensed Goods" and Recital F records that Tanmari and Mr Cummings grant an exclusive licence for "The Licensed Goods" to HSFS. The term "The Licensed Goods" is defined as: "A right to the Software package referred to as Quik Series Software and includes Quik Roof, Quik Truss, Quik Frame and Quik Floor and any adapations [sic] of those packages and also includes the Know How, methodology and trade secrets necessary for the implementation of "The Licensed Goods"." 60By cl 2.1 of the Exclusivity Agreement, Tanmari granted HSFS an exclusive licence to use and exploit "The Licensed Goods" for the Term in the Territory. By cl 7.1(e), Tanmari and Mr Cummings represented and warranted to HSFS that Tanmari "is the assignee and the beneficial owner of The Licensed Goods". That warranty is also inconsistent with any suggestion that JRC was the owner of QSS, whether on a non-exclusive basis or otherwise, and there is no suggestion that HSFS or Mr Pacione then took any objection to the accuracy of the warranty. Clause 14.4(a) in turn states that the Exclusivity Agreement replaces any previous understanding or agreement relating to the subject matter. I do not read that clause, in itself, as capable of excluding the operation of any previous agreement between different parties, relevantly, Mr Cummings and JRC. 61Mr Cummings gives evidence of a further conversation in late 2004 or early 2005 in words to the following effect: "Pacione: The deal with Stramit's fallen through. They don't need an exclusive licence any more. What do you want to do about the Exclusivity Agreement? Cummings: Let's just call it quits. Pacione: OK. I'll get Michael [Simone, Mr Pacione's solicitor] to prepare something." (Cummings 4.12.12 [104]) Mr Pacione denies that conversation and asserts that the move from an exclusive to a non-exclusive software licence was settled at the time the 2004 Agreement was signed in August 2004. A termination notice in respect of the Exclusivity Agreement was in fact signed in February 2005 (Pacione 26.10.12 [49], Ex P7, 3/232) with effect from 31 March 2005. 62A Development Agreement between HSFS and Tanmari in respect of a customer of HSFS, HCL (Ex P7, 3/233), also provides at cll 7.1 and 7.2: "7.1 Ownership of Source Software: [HSFS] acknowledges that [Tanmari] is the owner of the Source Software together with all Intellectual Property Rights in and to the Source Software (including all source and object code). 7.2 New Software: Exclusive Ownership of the New Software and all Intellectual Property Rights in and to the New Software (including all source and object code) shall be and remain vested in [Tanmari]." That acknowledgement similarly binds HSFS and is again inconsistent with JRC then owning QSS or the copyright in it by reason of the 2002 Agreement. A statement that Tanmari owned QSS and the intellectual property rights in the source software and source code would be radically incomplete if (as the Plaintiffs now contend) each of Tanmari and JRC had corresponding, albeit non-exclusive, ownership interests in QSS, the software and the copyright in QSS. 63For these reasons, I do not consider that the 2002 Agreement amounted to an assignment of the copyright in QSS to JRC or conferred an ownership interest in QSS on JRC, and it amounted to the sale of a non-exclusive licence to use software in a particular form and additional services to which I will refer below. Whether any ownership interest in QRC was limited by particular matters (Plaintiffs' issues 2-4) 64The second, third and fourth issues identified by the Plaintiffs are, if JRC bought an "ownership" interest in QSS under the 2002 Agreement, whether that ownership interest was limited to QSS as at 28 July 2002 (Defence [14(b)]); if JRC purchased an ownership interest in QSS that was not limited to QSS as at 28 July 2002, whether, after Tanmari was incorporated and from 4 February 2004, Mr Cummings did not own any work in updates to QSS, so the 2002 Agreement only included updates until 4 February 2004 (Cross-Claim [8], [10]); and whether, if JRC had an ownership interest in QSS including all updates, any event has brought the ownership interest to an end. These issues do not arise since I have held that the 2002 Agreement did not amount to an assignment of the copyright in QSS to JRC or confer an ownership interest in QSS on JRC. I will address the corresponding issues in respect of the licence arising under the 2002 Agreement below. If JRC has a non-exclusive licence, is it limited to QSS as at 28 July 2002? (Plaintiffs' issue 6) 65The Plaintiffs submit that JRC's ownership interest was not limited to QSS as at 28 July 2002. They point out that the subject of the 2002 Agreement is "The Goods", and rely on the definition of that term as the right to the software package "Quik Series Software". They submit that the phrase "Quik Series Software" is not limited to 28 July 2002 or a version number in the definition of "The Goods", in the operative provisions or in the Recitals to the 2002 Agreement, although the release notes for QSS confirm that Mr Cummings labelled each new release of QSS with a version number (Cummings 4.12.12, Ex D6/215-302). 66The Plaintiffs submit that the purpose and object of the 2002 Agreement and the surrounding circumstances do not support the proposition that the rights in QSS dealt with under the 2002 Agreement are limited to the version existing at 28 July 2002. They point out that the recitals to that agreement provide that JRC was developing a steel construction framing system (Recital B) and did not have that system when the 2002 Agreement was signed (Defence [10(b)]). They also point out that the recitals to that agreement also contemplated that Mr Cummings would provide training and development services in future (Recital E and cl 6) and that Mr Cummings gave training pursuant to the 2002 Agreement in August and September 2002 (Cummings 4.12.12 [70]). They submit that Mr Cummings would need to use the then current code in the training and the development. That does not seem to me to take matters further since the fact that a party might provide training on an updated version of software, where an agreement contained an express provision as to development services, at a particular point in time does not establish an obligation to do so, still less to do so indefinitely into the future. 67The Plaintiffs submit that the surrounding circumstances are also that QSS was dynamic software that was regularly developed and updated. They point to Mr Cummings' evidence that from 1990 to 2002, he was spending four to five hours per night, five to six days per week developing QSS and, between 2002 to November 2011, he was spending between 60 to 80 hours per week developing QSS, which included customising QSS for certain clients (Cummings 4.12.12 [26]) and that he released more than 500 versions (Cummings 4.12.12 [32]) and release notes (Ex D6/215-302). Mr Pacione's evidence confirms that Mr Cummings made regular updates, sometimes daily and more than weekly (Pacione 26.10.12 [27], [43] and Ex P7, 3/60). Many of these matters postdate the entry into the 2002 Agreement and are not, in my view, properly admissible in respect of the construction of that agreement where they are not in the nature of admissions as to factual matters. In any event, the fact that software was regularly updated does not provide any support for a proposition that the subject matter of the 2002 Agreement was not the grant of licence to use the software at a point of time, where the evidence is that Mr Cummings also provided updates to other persons to whom he had "sold" QSS software without entering any agreement such as the 2002 Agreement. The Plaintiffs also refer to several other subsequent matters that they contend support a view that the 2002 Agreement did not refer to the software at the relevant point of time, including dealings with Stratco in late 2002 and the terms of the later sale of copyright in QSS to FIPL. Those matters postdate the relevant agreement, are not admissions as to a question of fact and are not admissible as to the construction of that agreement: Johnston v Brightstars Holding Company Pty Ltd above. 68The Plaintiffs rely on that fact that Mr Cummings provided JRC with a version of the source code on 13 August 2002 by a compact disc labelled August 2002 (Pacione 26.10.12 [21]-[22], P7, 3/55). They submit that that is not the form of QSS as at 28 July 2002; point to Mr Cummings' evidence that this was the complete source code for QSS "as it then existed" (Cummings 4.12.12 [67]); and submit that, during cross-examination, Mr Cummings accepted that he was not able to tell the Court that the compact disc he gave Mr Pacione was exactly the same version that existed as at 28 July 2002 (T280). This also does not seem to me to assist the Plaintiffs, since it is at least equally consistent with a position that Mr Pacione, sensibly, did not object to Mr Cummings providing a (slightly) more up-to-date version of the software source code that was strictly required under the 2002 Agreement, if it was directed to the software existing at the date of the agreement. 69The Plaintiffs also rely on the fact that, by an undated letter on the letterhead of Quik Series Software, sent by Mr Cummings on 1 March 2004 (Ex P2 79), Mr Cummings stated as follows: "To whom it may concern: This is to certify that [JRC] have been given non exclusive rights to on sell Quick Series Software as defined under the "Deed of Agreement" dated 28thth [sic] July 2002. While not explicitly stated in this agreement, [JRC] has also been granted a non-exclusive right to market Quik Series Software under the HayesCad banner." 70Mr Pacione's evidence is that that facsimile came into existence at his request for marketing purposes (Pacione 26.10.12 [42]). Mr Cummings' evidence was that, after the Exclusivity Agreement was signed, he had a conversation with Mr Pacione who said words to the effect that: "I need a marketing document from you to show overseas clients that I'm allowed to sell Quik Series. I'll send you the wording. Can you fax it back to me on your letterhead?" (Cummings 4.12.12 [89]) Mr Pacione denied that conversation (Pacione 28.1.13 [45]). I think it likely that conversation, or at least a conversation substantially to that effect, took place, since Mr Pacione would have needed to provide some explanation to Mr Cummings as to why he was being asked to sign this letter, which Mr Pacione had drafted and which Mr Cummings then copied and pasted onto Tanmari's letterhead (Cummings 4.12.12 [90]). 71That facsimile focuses on marketing rights (described as "rights to on-sell" or as "right to market") as distinct from any rights in the underlying product. The Plaintiffs point out that that letter does not limit JRC to QSS as at 28 July 2002 (Ex P2 79; Pacione 26.10.12 [42], Ex P7, 3/203). It seems to me that that letter is equally consistent with the position that the 2002 Agreement was treated as conferring a right to sell and use the software as at the relevant date, as updated as provided under that agreement and by releases voluntarily provided by Mr Cummings not only to JRC but to his clients generally. It also seems to me that that letter provides a slender basis for any inference as to the construction of the 2002 Agreement where Mr Cummings' evidence, which I accept, was that it was drafted by Mr Pacione and that, in effect, he took little notice of it where all it was doing was confirming that JRC could distribute the relevant product (T274). 72The Plaintiffs also point out that Mr Cummings made updates available, first by email to each user and then from some time in 2003 on his website (Pacione 28.1.13 [26] and Annexure "H"; Cummings 14.10.13 [70]; 4.12.12 [75]). It does not seem to me that this assist the Plaintiffs' claim in this regard since Mr Cummings also made such updates available to other users who had not entered such agreements. The Plaintiffs also point out that Mr Cummings did not charge for modifications for development work for the Stratco project delivered in November 2002 because he says "I considered it to be part of the delivery of QSS to Stratco" (Cummings 4.12.12 [74]). That may well have been a fair and constructive approach by Mr Cummings but that fact does not seem to me to amount to an admission that the 2002 Agreement was not limited to the then version of the software, subject to the provision of development services in accordance with its terms. 73Next, the Plaintiffs point out that Mr Cummings was party to and signed an agreement dated 11 July 2003 relating to the Stramit project, which recited that JRC had a non-exclusive interest in the software to be used in that project (Recital C, Pacione 26.10.12 [35], Ex P7, 3/143). The Plaintiffs submit that it is not reasonable that the parties would be using QSS as at 28 July 2002 for a project starting in 11 July 2003 even though QSS had been updated several times since 28 July 2002. The Plaintiffs point out that Mr Cummings conceded in cross-examination that he read through the document before signing it, that he would have raised objections if he was not content and was content with the contents of that document when he signed it (T273). So far as that recital recorded that JRC had a right to use QSS arising from the 2002 Agreement, that statement would be no less true if the right related to the software as at the date of that agreement and JRC was dependent on the provision for development services in that agreement and Mr Cummings' practice of continuing to circulate updates of the product to his clients generally. 74It seems to me that the structure of the 2002 Agreement, and particularly the use of the term "The Goods", is consistent with the delivery of property in "The Goods" as they existed at the relevant point in time and does not have ambulatory or future operation indefinitely into the future. It seems to me that the striking absence of any limits to, or controls upon, JRC's conduct under the 2002 Agreement provides compelling evidence that that agreement should not be construed in the manner for which JRC contends. It seems to me improbable that the parties could have objectively intended that Mr Cummings would grant a licence to use (still less assign the copyright in) all future versions of QSS extending into the future without any time limitation, so as to allow JRC to sub-license others (such as SFSI) who could in turn distribute software to others (as SFSI has done), without imposing significant controls on the use of that software. The lack of control on future use of the software is more readily explicable if that agreement is understood as directed to the software as it existed at a point in time and Mr Cummings assumed only a limited contractual obligation to update that software. 75For these reasons, it seems to me that the non-exclusive licence granted to JRC under the 2002 Agreement is limited to QSS as at 28 July 2002, although Mr Cummings and Tanmari in fact continued to provide updates beyond that date (as they also did to other clients without such agreements) and JRC would also acquire a licence to use modifications and developments which it made, or retained Mr Cummings to make, under the terms of the 2002 Agreement. If JRC has a non-exclusive licence to use QSS that is not limited to QSS as at 28 July 2002, does Mr Cummings not own any work in updates to QSS created after Tanmari was incorporated, so the 2002 Agreement only covers updates until 4 February 2005? (Plaintiffs' issue 7) 76This question does not strictly arise, since I have held that the non-exclusive licence to use QSS arising from the 2002 Agreement is limited to the then current version of QSS. 77The Plaintiffs submit that Mr Cummings was the owner of copyright in QSS until he assigned his rights to FIPL on 31 October 2011. They plead that Tanmari owned or controlled some copyright (Amended Statement of Claim [5(b)]) and this paragraph does not necessarily concede ownership, as distinct from control, of copyright on the part of Tanmari. The Defendants plead (Defence to the Amended Statement of Claim [4(c)]) that Tanmari was the owner of copyright in QSS from 4 February 2004 until Tanmari assigned its rights to FIPL on 31 October 2011. The Plaintiffs point out that that date is not explained, since Tanmari was incorporated on 11 November 2003. 78The Plaintiffs point out that Mr Cummings is the author of QSS (Cummings 4.12.12 [3]; 14.10.13 [37]). Mr Cummings submits that he incorporated Tanmari which owned the assets of his business including copyright until 1 November 2011 (Cummings 14.10.13 [76]). The Plaintiffs point out that Tanmari can become the owner of the copyright only if there is a written assignment signed by Mr Cummings as the assignor under s 196 of the Copyright Act, or if Mr Cummings made the work in pursuance of the terms of his employment under a contract of service under s 35(6) of the Copyright Act. As the Plaintiffs point out, there is no evidence of a written assignment, and no such document was produced in response to a notice to produce any written agreement pursuant to which Mr Cummings assigned his copyright to Tanmari (Ex P3). The Plaintiffs point out that there is no evidence that Mr Cummings was employed by Tanmari under a contract of service, and that the Defendants conceded in their written opening submissions that there is no employment contract between Tanmari and Mr Cummings (Defendant's Opening Submissions [33]) and confirmed that position during oral argument about objections. 79The Defendants contend that Tanmari, either alone or together with Mr Cummings, owned the copyright in QSS as and from the date of incorporation of Tanmari. The recitals in the several agreements to which I have referred above support this submission, and seem to me to be admissible as to that matter for the reasons I noted in paragraph 55ff above. The Defendants also contend that Tanmari obtained at least an equitable interest in the copyright, so far as the programs were written by Mr Cummings in his capacity as a director of Tanmari and for the purposes of its business: Antocks Lairn Ltd v I Bloohn Ltd [1971] FSR 490; [1972] RPC 219; Gram Engineering Pty Ltd v Bluescope Steel Ltd [2013] FCA 508; (2003) 106 IPR 1 at [391]-[407] per Jacobson J. On the other hand, the Plaintiffs respond that, in Antocks Larin Ltd v I Bloohn Ltd above, the Court held that a company did not automatically own copyright works created by the managing director of a company, and the company did not there established that it owned the copyright pursuant to a contract of service because it was not established that there was a contract of service between the managing director and the company requiring the managing director to do the work. The Defendants refer to two cases where a work created by a company's director was owned by the company. In Gardex Ltd v Sorata Ltd [1986] RPC 623, Falconer J held that a company owned a design, where a company's managing director was also an employee under a contract of service. No such contract is in evidence in this case. In Gram Engineering v Bluescope Steel above at [400]-[403], Jacobson J applied Gardex Ltd v Sorata Ltd above in holding that a company was entitled to be registered as the owner of a design, where a director was paid a salary in regular weekly or monthly instalments, although not employed under a written contract of employment. There is no evidence of such an arrangement in this case. The Plaintiffs also point out that, whereas a person may be entitled to be registered as the owner of the design if the design is made by a person in the course of the person's employment, under ss 19(2) and (3) Designs Act 1906 (Cth) (applied in Gram Engineering v Bluescope Steel above) and s 13(1)(b) of the Designs Act 2003, the Copyright Act requires that the work must be made "in pursuance of the terms of [a person's] employment by another person under a contract of service" under s 35(6) of the Copyright Act. There is no evidence in this case that Mr Cummings was employed under a contract for service. It does not seem to me that Tanmari acquired the copyright in QSS on that basis. 80The Defendants also submit that a director who creates copyright works holds the copyright on trust for company, and there is authority that a copyright owner may own the copyright on trust for others: Bulun Bulun v R & T Textiles Pty Ltd (1998) 86 FCR 244; 157 ALR 193. I accept that is at least a possibility, since it seems to me that it would a breach of Mr Cummings' equitable duties to Tanmari to contend that he had ownership of the copyright to the exclusion of Tanmari, which might well be met by the imposition of a constructive trust. However, as the Plaintiffs point out, that proposition does not divest Mr Cummings of his legal ownership of the copyright. 81At least some later documents executed by Mr Cummings are consistent with his continued ownership of the copyright in QSS, to the exclusion of Tanmari, including a memorandum of understanding relating to QSS between Metalforming Technologies Ltd (a predecessor to FIPL) and Mr Cummings dated 5 September 2005, well after the date that Tanmari was incorporated (Ex P2 154A). The later FIPL Purchase Agreement also recites that Tanmari and Mr Cummings own the software and the "Vendors" (defined as Tanmari and Mr Cummings) transfer the "Assets" that include QSS (FIPL Purchase Agreement cl 2.1) and assign the Vendor IP (as defined) (FIPL Purchase Agreement cl 5.1). Compact discs containing QSS issues by Mr Cummings after Tanmari's incorporation are also consistent with his continued ownership of the copyright in QSS, to the exclusion of Tanmari, containing copyright notices in the name of Robert Cummings & Associates (for example, Pacione 28.1.13 JP4-F, Ex P2 277). 82On balance, it seems to me that the matters to which I have referred above support a finding that Mr Cummings owned the copyright in QSS, to the exclusion of Tanmari, which was granted a licence for that copyright to the extent that, for example, Tanmari entered into licences granting rights in QSS to their parties. This finding is, however, of no assistance to the Plaintiffs in extending their rights under the 2002 Agreement which, as I have held above, were limited to QSS as at 28 July 2002 and updates and modifications provided to them or made under the terms of that agreement. If JRC has a non-exclusive licence that includes the right to use QSS, is that non-exclusive licence limited to JRC licensing QSS to Stratco? (Plaintiffs' issue 8) 83The Defendants plead that the 2002 Agreement is limited to dealings with JRC is respect of the Stratco project. Mr Cummings' evidence is that the 2002 Agreement was entered into in respect of a single project for Stratco which wished to purchase a steel framing system comprising roll forming machinery and integrated software (Cummings 4.12.12 [54]). 84It is clear that the 2002 Agreement was entered into in the context of dealings with Stratco. Mr Cummings attended Stratco sites in respect of training in mid-August 2002 (Cummings 4.12.12 [70]) and invoiced JRC for development and training in respect of Stratco in early September 2002 (Pacione 26.10.12 [25], Ex P7, 3/58; Pacione 28.1.13 Annexure D; Cummings 14.10.13 [67]). A further payment was made by JRC to Mr Cummings on 13 September 2002 in respect of the purchase price and Stratco development and training (Pacione 26.10.12 [25]). Mr Cummings made further modifications in respect of Stratco in November 2002 (Cummings 4.12.12 [72], Ex P7, 3/131-132). 85I recognise that, following the decisions in Electricity Generation v Woodside above and Mainteck Services Pty Ltd v Stein Heurtey SA above, ambiguity is not required for the Court to have regard to surrounding circumstances in the construction of the 2002 Agreement. I accept that the context of the entry into the 2002 Agreement and Mr Cummings' subjective intention may have been limited to granting rights in respect of that project on the basis that further agreements would be executed, as they were, in respect of further projects. However, the terms of that agreement do not limit the rights granted to those necessary for JRC's involvement in the Stratco project. It is, however, as I noted above, limited to the grant of such a licence in respect of the then software. 86The Plaintiffs also refer to subsequent conduct, which seems to me to be admissible as to the extent that it involves an admission of fact, under the principles to which I have referred above. It is not necessary to deal with all of the conduct on which the Plaintiffs rely in this context. The more significant conduct seems to me to be that, on 11 July 2003, Mr Cummings, NBR and HSFS entered an agreement relating to the Stramit project which recited that JRC had a non-exclusive right to the software package to be used in a project for Stramit (Recital C, Ex P2, 48; Pacione 26.10.12, Ex P7, 3/146), after the Stratco project had previously been completed on 6 November 2002. Mr Cummings also signed the letter dated 1 March 2004, to which I have referred above, confirming that JRC has non-exclusive rights to "on-sell" and "market" QSS under the 2002 Agreement (Ex P2 79; Pacione 26.10.12 [42], Ex P7, 3/203), which was inconsistent with a limitation of those rights to the Stratco project. Documents that Mr Pacione provided to Mr Cummings during this period also dealt with the wider development of a system referred to as the "Hayes Base System" and were not limited to the Stratco project (for example, Ex P2 39; Pacione 26.10.12, Ex P7, 3/132; Ex P2 41, Pacione 26.10.12, Ex P7, 3/134; Ex P2 42, Pacione 26.10.12, Ex P7, 3/135). 87I therefore conclude that JRC's rights under the 2002 Agreement, although limited to QSS as at 28 July 2002 and updates and modifications provided to them or made under the terms of that Agreement, were not restricted to licensing QSS to Stratco. If JRC has a non-exclusive licence that includes a right to use QSS that is not limited to Stratco, has any other event brought that licence to an end? (Plaintiffs' issue 9) 88By paragraph 14(a)(1) of their Defence, the Defendants plead that the 2002 Agreement has come to an end in accordance with that agreement or expired. As the Plaintiffs point out, the 2002 Agreement had no express limited term providing for expiry or termination and was not expressly limited to any project that has been completed. The Defendants submit that the 2002 Agreement came to an end by performance on delivery of the relevant disc containing the software. I do not accept that submission, which is inconsistent with the continuing option for Mr Cummings to provide development services under cl 5 of the 2002 Agreement, although I accept that the obligations in respect of the sale of "The Goods" under the 2002 Agreement were discharged by the delivery of the disc containing the software. 89The Defendants also contend that the 2002 Agreement was superseded by the Exclusivity Agreement or the 2004 Agreement, to which I will refer below. Alternatively, the Defendants submit that the 2002 Agreement was revocable and was revoked, including by later agreements entered into by Mr Pacione on behalf of each of JRC and HSFS. The Defendants submit that each later agreement effectively replaced, and implicitly revoked, any earlier agreement concerning QSS. 90As I noted above, an agreement entered into in July 2003 between HSFS, Mr Cummings and NBR included, in cl 5, a software licence by Mr Cummings to HSFS which authorised HSFS to grant sub-licences of QSS (Pacione 26.10.12, Ex P7, 3/143-158). The Defendants contend that, from July 2003, HSFS replaced JRC as the licensee of QSS with the right to grant sub-licences. 91Recital B of the Exclusivity Agreement, entered in February 2004, in turn recorded that HSFS wished to obtain an "exclusive Australian territory licence" to exploit the "Licensed Goods", relevantly QSS, and Recital D recorded the parties' agreement that the licence replaced any other agreement to use "The Licensed Goods" in the Territory. By cl 2 of the Exclusivity Agreement, Mr Cummings and Tanmari granted HSFS an exclusive licence to "use and exploit" "The Licensed Goods" (Pacione 26.10.12, Ex P7, 3/185-199; Ex P2, 64-78) in respect of "the Territory", namely Australia. The term "Licensed Goods" is defined in similar terms to "The Goods" in the 2002 Agreement. Clause 14.4 of the Exclusivity Agreement in turn stated that: "any previous understanding [or] agreement ... relating to the subject matter is replaced by this document and has no further effect". As I noted above, it is common ground that exclusivity was sought by HSFS in connection with a project for Stramit, when Mr Pacione (on behalf of HSFS) was in discussions to offer exclusivity to Stramit. By about July 2004, Stramit terminated the negotiations for exclusivity and Mr Pacione's evidence is that HSFS no longer required exclusivity (Pacione 26.10.12 [44]). The Defendants submit that the acquisition of an exclusive licence by HSFS under the Exclusivity Agreement indicates that any licence or interest remaining vested in JRC had lapsed or been abandoned. 92I have not neglected the fact that Mr Pacione drafted and Mr Cummings signed an acknowledgment for the benefit of overseas customers (Ex P2/79) on the same date as the execution of the Exclusivity Agreement on 25 February 2004. The language of that acknowledgement was directed to JRC's "non exclusive rights to on sell Quik Series Software". It seems to me that document did no more than acknowledge JRC's position as a distributor of QSS. I have also not neglected the subsequent agreement in relation to the Stramit project (Ex P2 48, Pacione 26.10.12, Ex P7, 3/146). 93Clause 2.5 of the 2004 Agreement (which I will address in detail below) in turn provides that: "The parties agree that this document replaces any current licences and licensing conditions issued with, or in relation, to the Software with the exception of the Exclusivity Agreement." This clause plainly contemplates that the 2004 Agreement and the Exclusivity Agreement were the totality of the agreements governing the software, so far as HSFS was concerned. The Plaintiffs submit that the 2004 Agreement could not terminate the 2002 Agreement because that agreement is between Mr Cummings and JRC, whereas the 2004 Agreement is between HSFS and Tanmari. The Plaintiffs also point out that, when the 2004 Agreement was signed, the majority shareholder in HSFS was Bradbury International, and JRC was a minority shareholder although Mr Pacione appears to have exercised day-to-day control of the HSFS business (Pacione 26.10.12 [34]; 28.1.13 [53]). I accept that an agreement to which JRC is not party to may not bring about the termination of the 2002 Agreement. However, the conduct of HSFS, under Mr Pacione's control, in this regard may evidence a separate abandonment of the 2002 Agreement to which JRC was party. 94The Plaintiffs also submit that the Defendants have not pleaded a claim for abandonment of the 2002 Agreement. Nonetheless, both parties led evidence as to the relevant agreements and their implementation and addressed the issue in submissions, and it seems to me the case was conducted on the basis that whether the 2002 Agreement remained in force was in issue. In particular, the Plaintiffs submitted that: "In any case, [HSFS] and Tanmari entering into the Exclusivity Agreement did not terminate the [2002 Agreement]. Tanmari purported to grant [HSFS] exclusive rights. If Tanmari could not do so because Tanmari had either assigned or granted non-exclusive rights to JRC, then the consequences are that Tanmari was in breach of the Second Agreement and is liable for damages. Nemo dat quod non habe - Tanmari cannot grant rights that it does not have, and Tanmari does not regain all of the rights merely because it is purporting to grant an exclusive licence to a party, [HSFS], who has a common director with a third party that it has assigned or granted non-exclusive rights to, JRC. The better view of the Exclusivity Agreement is that [HSFS] is merely getting exclusive rights in the rights that Tanmari owns or controls (if anything). The only other person with rights, JRC, was a 20% shareholder of [HSFS] at the time, so [HSFS] could rely on JRC not exercising its rights to interfere with [HSFS] required exclusivity. In contrast, Tanmari was an unrelated third party, so [HSFS] needed to lock Tanmari's rights down." 95The Plaintiffs also submit that HSFS's position under the Exclusivity Agreement and the 2004 Agreement is not relevant to JRC's position in respect of the 2002 Agreement. The Plaintiffs submit, and I accept, that a recital in an agreement between Mr Cummings and Tanmari on the one hand and HSFS on the other does not, as a matter of contract, bind HSFS. However, JRC was a shareholder in HSFS and each were relevantly controlled by Mr Pacione, and the fact that HSFS repeatedly acknowledged that previous agreements with respect to QSS had been replaced and that it had the exclusive rights to QSS seems to me to provide a strong basis for a factual inference that that was the case, albeit it had come about in an informal manner. It seems to me that that matter, combined with the fact that none of the parties thereafter exercised rights under the 2002 Agreement for a considerable time (until JRC purported to do so after their relationship broke down), supports an inference of an abandonment by Mr Cummings and JRC of earlier inconsistent arrangements under the 2002 Agreement. 96The parties directed limited attention to the contractual principles applicable to abandonment. In N Seddon and MP Ellinghaus, Cheshire & Fifoot's Law of Contract, (9th Australian ed 2008, LexisNexis Butterworths) at [22.9], the authors observe that a contract must be regarded as discharged if both parties in fact treat it as at an end, even if no contract to discharge it can be spelled out. I also recognise that discharge of a contract by implied abandonment is, as Professor Carter observes in JW Carter, Breach of Contract (2011, LexisNexis Butterworths) at 606, "a fairly rare phenomenon". In Summers v The Commonwealth [1918] HCA 33; (1918) 25 CLR 144, the High Court held that the passage of time during which neither party took steps to perform a contract amounted to a mutual abandonment of that contract. Isaacs J there observed (at 151-152) that: "Whatever the terms of a contract may be, it is possible for the parties so to conduct themselves as mutually to abandon or aggregate it. ... In my opinion, that is the legal position here. Informally, but effectively, the parties have so acted in relation to each other as to abandon or abrogate the contract." 97In Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420, Dixon CJ and Fullagar J observed, although not holding that abandonment had been established in that case that: "Where ... an "inordinate" length of time has been allowed to elapse, during which neither party has attempted to perform, or called upon the other to perform, a contract made between them, it may be inferred that the contract has been abandoned". 98The plurality of the High Court took a similar view in DTR Nominees Pty Ltd v Mona Homes Pty Ltd [1978] HCA 12; (1977-1978) 138 CLR 423 at 434, where their Honours observed that, by the time those proceedings were commenced, neither party regarded a contract as still being on foot, and must be regarded "as having so conducted themselves as to abandon or abrogate the contract". In Fightvision Pty Ltd v Onisforou [1999] NSWCA 323; (1999) 47 NSWLR 473 at [78], the Court of Appeal held that a novation by which one obligation is extinguished and a substituted obligation is created in its place made be implied from the circumstances. In CGM Investments Pty Ltd v Chelliah [2003] FCA 79; (2003) 196 ALR 548 at [18] (reversed on other grounds at [2003] FCAFC 279), Finkelstein J observed that abandonment depended upon the parties' conduct, objectively viewed, rather than upon any subjective intention to abandon an agreement. In Iacullo v Hillam [2014] NSWSC 1021, Ball J at [37] observed that whether one contract is intended to replace another depends on the objective intention of the parties, although his Honour held that abandonment was not established on the particular facts where subsequent agreements were between the same parties and covered the same subject matter, but the parties did not say or do anything to suggest that they intended that the later agreements would replace the earlier ones. 99In this case, notwithstanding that JRC was not party to the Exclusivity Agreement and the 2004 Agreement, it seems to me that the plain inference from those agreements is that the parties, including JRC (which, as I have noted, was under Mr Pacione's control) intended the Exclusivity Agreement and the 2004 Agreement to replace the 2002 Agreement. The recitals and terms of the Exclusivity Agreement and 2004 Agreement would not have sensible operation, absent such an intention. No later than the date of entry into the 2004 Agreement, Mr Pacione, Mr Cummings, HSFS and Tanmari seem to me to gave treated the relevant rights as arising under the Exclusivity Agreement and the 2004 Agreement and, more fundamentally for present purposes, JRC did not take any step to exercise rights of ownership of software under the 2002 Agreement, nor did Mr Cummings act as though that agreement were on foot, after that agreement was executed and until Mr Pacione later claimed that JRC had, in 2009, assigned rights under the 2002 Agreement to SFSI. The parties, consistent with the informality of their dealings generally, did not take steps expressly to terminate the 2002 Agreement, but it seems to me that an abandonment of that agreement may properly be inferred from these circumstances. For these reasons, I find that the non-exclusive licence to JRC to use QSS did come to an end by abandonment, at least by the entry into the 2004 Agreement. 100For completeness, I note that the licence granted to JRC under the 2002 Agreement was also expressly sought to be revoked by a letter from Mr Cummings' and Tanmari's solicitor dated 24 January 2012 (Ex P2, 384-388) or by a further letter from Mr Cummings' and Tanmari's solicitor dated 23 May 2014 (Ex P2, 401-416). It is not necessary to address those matters since I have held that the 2002 Agreement had previously been abandoned. If JRC has a non-exclusive licence that includes the right to use all QSS updates that has not terminated, expired or completed, does it bind FIPL? (Plaintiffs' Issue 10) 101The Plaintiffs point out that, under s 196(4) of the Copyright Act, a licence granted by the copyright owner binds every successor in title to the copyright owner's interest to the same extent as the licence was binding on the grantor. They contend that, if the 2002 Agreement is a licence rather than an assignment, then FIPL is Mr Cummings' successor in title under the FIPL Purchase Agreement and that licence binds FIPL. This issue does not arise in these terms given the findings that I have reached above. However, the right conferred on JRC to use the software as it existed at the time of the 2002 Agreement, and the implied licence to use updates provided under the terms of that agreement and voluntarily provided by Mr Cummings, would bind FIPL under the principles to which the Plaintiffs refer, had that agreement not been abandoned as I have noted above. Consequences of Plaintiffs' success under the 2002 Agreement (Plaintiffs' issues 11-12) 102The Plaintiffs contend out that, if they had succeeded in respect of their issue 10, then JRC, HSFS and SFSI would be entitled to use and sub-license the use of QSS and all updates to customers for the full period of copyright. I have held that JRC had a more limited licence under the 2002 Agreement, which was abandoned at least by the point of entry into the 2004 Agreement. No such right has been established in respect of HSFS arising out of the 2002 Agreement since it has not been established that JRC at any point conferred any rights on HSFS. 103No such right has been established in respect of SFSI arising out of the 2002 Agreement since that agreement had been abandoned before any purported conferral of rights by JRC on SFSI relying on that agreement. Although it is not strictly necessary to do so, I will address below the question whether it has been established that JRC (by Mr Pacione) granted a sub-licence to SFSI (by Mr Pacione) in April 2009 in reliance on its rights under the 2002 Agreement, in terms sufficient to authorise SFSI's sub-licensing of QSS to third parties after that date. Source Code and Updates under the 2002 Agreement (SOC [15]-[26]) (Plaintiffs' issue 13) 104The next issue identified by the Plaintiffs in respect of the 2002 Agreement is, if JRC has the right to use and sub-license the use of QSS and all updates under the 2002 Agreement, whether Mr Cummings has an obligation to provide JRC with the source code for QSS and all updates. This issue does not strictly arise, since I have held that JRC does not have a right to use and sub-license QSS, other than as it existed at the time of the 2002 Agreement, and as updated by updates that Mr Cummings subsequently provided under the terms of that agreement or under the practice of voluntary updates that he has adopted with customers generally. I have also held that the 2002 Agreement was abandoned no later than at the time of HSFS's and Tanmari's entry into the 2004 Agreement. 105The Plaintiffs plead (Amended Statement of Claim [15]) an express term of the 2002 Agreement that Mr Cummings was required to provide JRC with updated set-up disks as required to load the latest version of QSS under cl 6 of the 2002 Agreement. Alternatively, the Plaintiffs plead an implied term in the 2002 Agreement that Mr Cummings would provide JRC with updates to QSS. As I noted above, cl 6 of the 2002 Agreement provided that Mr Cummings would provide all relevant materials pertaining to the design and development of QSS including functional specifications and source code, and complete and updated set-up disks as required to load the latest complete and operational version of QSS. 106Mr Cummings' evidence is that he provided the source code for QSS to Mr Pacione in August 2002, when Mr Pacione paid the second progress payment contemplated under the 2002 Agreement. His evidence is that: "The source code for QSS was held in a single folder on the hard drive of my computer. When I copied the source code, I copied the folder containing the QSS source code to a CD and gave it to Mr Pacione. I labelled the CD 'Quik Series Source Code for HayesCad and Stratco'. That was the complete source code for QSS as it then existed. I also gave Mr Pacione a hard copy print out of the source code." (Cummings 4.12.12 [67]) Mr Pacione's evidence, to which I referred above, is that Mr Cummings provided JRC with a version of the source code on 13 August 2002 by a compact disc labelled August 2002 (Pacione 26.10.12 [21], [22]; Ex P2, 32; Ex P7, 3/55). That disc is also labelled as containing AutoLISP source code, VB source code, C++ ARX source code and C++ SDS source code, and also records that the source codes are in uncompressed formats. 107In any event, the expert evidence led in the joint experts' report by the experts retained by the parties, Mr McLauchlan (retained by the Plaintiffs) and Mr Bilkey (retained by the Defendants), is that a person who is provided with an executable version of QSS version 11.176 in AutoLISP programming language also obtains a copy of the relevant source code (Ex P7, 2/Tab 11, 7). The Plaintiffs referred to discrepancies in the source code, but such discrepancies have not been established where the evidence of them rises no higher than the comments made by the proposed escrow holder in emails (to which I will refer below) and Mr Cummings' denial of their correctness (Cummings 4.12.12 [112]). 108Clause 6 of the 2002 Agreement, to which I have referred above, required Mr Cummings to provide JRC with "updated" set up-disks "as required to load the latest complete and operational version of 'The Goods'". The Plaintiffs submit that the use of the word "latest" and "updated" combined with "as required" is an express term that the 2002 Agreement covers QSS and all updates to it. I do not accept that submission. It seems to me that this obligation must be construed by reference to the definition of "The Goods" in the 2002 Agreement, referring to the right to the software package that was sold under that agreement at a point in time, and the words "latest, complete and operational version of 'The Goods'" in turn require that the version have that character as at that time. The contrary view would have the result that Mr Cummings would have taken upon himself an obligation of updating the software that continued without time limitation into the indefinite future, in consideration of a payment of some $25,000, a substantial part of which was referable not to the software but to future development works. The words "as required" seem to me to refer to the set-up discs that were required to (in the sense of necessary to) load the relevant software, not to any ongoing ability of JRC to require further software to be provided. In any event, that obligation ceased when the parties abandoned the 2002 Agreement as noted above. 109Mr Cummings subsequently regularly amended the QSS software and issued new releases to it and updated set-up disks of it, and sent emails attaching updates to QSS and provided access to his website that allowed the user to download updates to QSS. However, that was consistent with the existence of the 2004 Agreement and was also the practice he adopted in respect of other clients who had acquired software without entry into such agreements. 110In the further alternative, the Plaintiffs contend that there is an implied term in the 2002 Agreement that covers updates and is not limited to QSS as at 28 July 2002. The requirements for the implication of such a term are, as the Plaintiffs recognise, those set out by the majority of the Privy Council in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 282-283, as approved by Mason J in Codelfa Construction Pty Ltd v State Rail Authority of New South Wales [1982] HCA 24; (1982) 149 CLR 337 at 347, namely, the specified term (1) must be reasonable and equitable; (2) must be necessary to give business efficacy to the contract so that no term will be implied if the contract is effective without it; (3) must be so obvious that 'it goes without saying'; (4) must be capable of clear expression; and (5) must not contradict any express term of the contract. 111The Plaintiffs contend that term satisfies each of these requirements and, in particular, that that implied term is necessary to give business efficacy because the 2002 Agreement contemplates future activities such as the development of a system that QSS will be used with and future training, in the context of software that is being constantly updated. In my view, the suggested implied term does not satisfy several of those requirements. First, I do not consider that that term is reasonable and equitable, so far as it would continue indefinitely into the future. Second, the implication of a term also depends upon the demonstration of necessity: Byrne v Australian Airlines Ltd [1995] HCA 24; (1995) 185 CLR 410 at 452-453 per McHugh and Gummow JJ; Australis Media Holdings Pty Ltd v Telstra Corporation Ltd (1998) 43 NSWLR 104. In my view, the suggested term is not necessary to give business efficacy to the 2002 Agreement which is effective without it, particularly where it contains an express term dealing with the position in respect of updates. Third, the suggested term, continuing indefinitely into the future, is by no means so obvious that it goes without saying. The suggested implied term is also inconsistent with cl 6 of the 2002 Agreement, read as conferring a right to the "latest, complete and operational version of 'The Goods'" as at the date of the agreement. If JRC does not have an ownership interest or a non-exclusive licence in QSS including all updates, is there another agreement by which Mr Cummings and Tanmari made modifications and developments to QSS at JRC's and then HSFS's request and expense (Plaintiffs' issues 14-16). 112The Defendants admit that Mr Cummings had granted JRC a right to use the modifications and developments under the 2002 Agreement (Defence [32]). The Plaintiffs submit that, if (as I have held) the 2002 Agreement was terminated, expired or was completed, then there must be another agreement between JRC and later HSFS with the Defendants dealing with work that does not relate to Stramit and predates the 2004 Agreement. The Plaintiffs submit that they paid for and were involved with Mr Cummings in developing QSS generally, as well as modifications to QSS that were specific to JRC. They point to a number of invoices relating to a number of projects (for example, Ex P2, 267, 271; Pacione 28.1.13 [22], Annexures "D" and "E") and submit that a number of these invoices pre-date the Stramit Agreement between HSFS and Stramit dated 2 July 2003 (Pacione 28.1.13 Annexure "J"), the Stramit Agreement between Mr Cummings, NBR and HSFS dated 11 July 2003 (Ex P2 48; Pacione 26.10.12, Ex P7, 3/146), and the 2004 Agreement. They point out that Mr Cummings accepts that that additional work was not done under the 2002 Agreement and predates the 2004 Agreement (Cummings 14.10.13 [50], [66]). They also point out that Mr Cummings acknowledges that between 2003 and 2007, he purchased IntelliCAD from vendors "for various customers, on [HSFS's] behalf and passed the costs onto HSFS" (Cummings 14.10.13 [15]). 113It does not seem to me that it follows that, if the 2002 Agreement was terminated (relevantly, by abandonment), then any work that does not relate to Stramit and pre-dates the 2004 Agreement must have been performed under some other agreement. First, the 2002 Agreement was not abandoned until the entry into other agreements involving HSFS and, specifically, by no later than the entry into the 2004 Agreement. Second, there is no reason to infer that every act undertaken by Mr Cummings at the Plaintiffs' request was performed by a separate agreement, rather than by the provision of the service either gratuitously or on the basis that Mr Cummings would charge for the service on an ad-hoc basis. Third, the terms of the suggested further agreement or how it came into existence are not identified by the Plaintiffs. 114The Plaintiffs also identify issues (issues 15 and 16) whether, if such an other agreement exists, there are terms of that other agreement that JRC and then HSFS would be entitled to use and sub-license the use of modifications and developments and to use and sub-license the use of QSS as part of using the modifications and developments. These questions do not arise since I have not held that any other agreement is established. I will nonetheless address the Plaintiffs' submissions in respect of them. 115The Plaintiffs submit that, if JRC or HSFS paid Mr Cummings to develop modifications of QSS, then JRC or HSFS would not automatically own the modifications, because Mr Cummings owns the copyright in the modifications because he is the author of the modifications and is not an employee of JRC or HSFS, for the purposes of s 35(2) of the Copyright Act and because there is no written assignment from Mr Cummings to JRC or HSFS, for the purposes of s 196(4) of the Copyright Act. They submit that there would be an implied licence from Mr Cummings to JRC or HSFS to use the material in the manner and for the purpose in which and for which it was contemplated between the parties that it would be used at the time of the engagement: Beck v Montana Constructions Pty Ltd [1964-5] NSWR 229 at 235. That may well be correct, but it plainly depends upon the circumstances of the particular dealing and does not indicate that any wider agreement exists. 116The Plaintiffs then submit that: "Therefore, the Plaintiffs have a right to use the Modifications and Developments to QSS Application that the Plaintiffs paid [Mr Cummings] to make that the Plaintiffs are using in the Plaintiffs' steel frame manufacturing system." That conclusion does not seem to me to follow from its premise. Whether the Plaintiffs would have such a right, if it does not arise from the 2002 Agreement or the 2004 Agreement, would depend upon the nature of the relevant dealings. It is possible that such dealings would give rise to a right to use a particular modification for a particular purpose. It is also possible that they would not, if they took place under a mistaken view of JRC's or HSFS's rights under the 2002 Agreement or a mistaken assumption that Mr Cummings (who had not taken legal advice for the large part of his dealings with Mr Pacione) would not in future take issue with JRC's, HSFS's or Mr Pacione's view as to the extent of their rights. The Plaintiffs do not seek to address the circumstances of particular dealings or how they might give rise to particular rights in particular modifications or developments in submissions and it does not seem to me that the Court can or should do so where the Defendants have not had notice, by ways of submissions, as to any position that might be taken in that regard. 117The Plaintiffs submit that it is not possible to use the modifications to QSS without using QSS and, if the Plaintiffs have a right to use the modifications, there may also be an implied licence to use the underlying QSS software. They submit that a non-exclusive licence to use copyright may be implied to give efficacy to a specific agreement between the parties and not to undermine or impede the use of the copyright work for the purpose for which it was prepared: Concrete Pty Ltd v Parramatta Design and Developments Pty Ltd [2006] HCA 55; (2006) 229 CLR 577 at [59] per Kirby and Crennan JJ; Copyright Agency Ltd v State of NSW [2008] HCA 35; (2008) 233 CLR 279 at [81], [87]. I accept that submission, so far as it goes, but it does not lead to the conclusion that a right to use QSS for any particular purpose has been established where a right to use particular modifications arising from particular dealings has not been established. The Plaintiffs then submit that: "Therefore, if the [2002 Agreement] is terminated, expired or completed, the Plaintiffs have an implied licence to use modifications to the QSS Application that the Plaintiffs paid [Mr Cummings] to make, as part of the Plaintiffs' steel frame manufacturing system. And in addition, the Plaintiffs have the right to use QSS Application to the extent it is necessary to use QSS Application in order to use the modifications to the QSS Application as part of the Plaintiffs' steel frame manufacturing system." Again, that conclusion does not seem to me to follow. Whether such a right would arise in particular circumstances would depend on those circumstances, and the Plaintiffs have not sought by their submissions to establish that matter in respect of any particular modification giving rise to any particular right to use QSS in any particular circumstances, other than those to which I refer below. 118The Plaintiffs submit that they helped develop QSS's "engineering" functionality, which incorporates look up tables and standards into QSS so that QSS could analyse a drawing in layout form and determine whether it complied with applicable standards. Mr Pacione's evidence is that the screenshot of QSS that he first saw did not include engineering functionality and a user could not specify a building code (Pacione 28.1.13 [5], Annexure "A"). Mr Cummings' evidence is that he only released that functionality in April 2003 (Cummings 4.12.12 [31], Ex D6 2; 14.10.13 [27], [28], [61]), at a point that he was involved with JRC's projects but also, it should be added, also with other clients. The Plaintiffs also submit that they "drove" the development of the engineering functionality as part of the "Hayes Base System" and that the engineering functionality is "reflected" in material that JRC provided Mr Cummings including specifications and other information (Ex P2 2; Pacione 26.10.12 [13] and Ex P7, 3/3); a discussion paper (Ex P2 39; Pacione 26.10.12 [29]; Ex P7, 3/132); a meeting agenda (Ex P2 41; Pacione 26.10.12 [30], Ex P7, 3/134); and an email from Mr Pacione outlining requirements (Ex P2 42; Pacione 26.10.12 [31], Ex P7, 3/135). The Plaintiffs point out that Mr Cummings' evidence does not explain, at least in detail, how he developed the engineering functionality (Cummings 14.10.13 [100]). They also point out that the engineering functionality was released for the Hayes Base System in release 11.219 (Hayes Base System and CNC file) on 3 February 2003 and was then released generally, 16 days later in release 11.221 on 19 February 2003 (Ex P2 263-264; Pacione 26.1.12, Ex P7, 3/129 and 130; Pacione 19.3.14 [42]-[44], [70]-[75].) 119The Plaintiffs submit that the significance of the modifications and developments is reflected in the fact that Mr Cummings incorporated the modifications into QSS including engineering functionality and a U-Cord Truss which had been developed by Mr Pacione or his companies for their customers (T223-224) and put to the cost of making the modifications and developments, which include payments made to Mr Cummings and Tanmari and to Mr Roulant and his company, NBR, for engineering work, including work under an agreement between JRC and NBR dated 11 February 2003 (Ex P2 44; Pacione 26.10.12 [32] and Ex P7, 3/136; Pacione 28.1.13 [6]). The Plaintiffs also submit that: "In particular, these files [sic] were important Chinese state-owned companies, BNBM Homes and BNBM Group. These were the Plaintiffs' customers and they used the Plaintiffs modifications to QSS, particularly their customer CNC files and U-cord truss and T-cord truss. When these customers transitioned to [FIPL], [FIPL] was able to continue to provide them with their customer CNC files, U-cord truss and T-cord truss because these Plaintiff modifications had become part of the standard QSS that FIPL was providing (Pacione 14.4 [146]; Roulant [63] to [69])." 120It seems to me that the evidence does establish that JRC or Mr Pacione prompted improvements in QSS, by identifying matters to be addressed, and that the engineering work undertaken by Mr Roulant or NBR on JRC's or HSFS's behalf is likely to have brought about improvements in QSS. I can accept that it may seem a matter of commercial unfairness that Mr Cummings or FIPL should benefit from those efforts without compensating JRC for them. However, no claim for unjust enrichment was brought, and such a claim may not have been available where, on one view, JRC was a volunteer in providing the relevant information to Mr Cummings or Tanmari. No claim for breach of confidentiality was brought, and such a claim may not have been available to the extent that the product of the work had been made available to many users of QSS. It does not seem to me that the Plaintiffs have established any legal basis for a proposition that, because JRC had made suggestions or provided information that may have improved QSS, or had incurred costs in doing so, it has a legal right to use modifications and developments to which they have contributed that does not arise from the 2002 Agreement, the 2004 Agreement or any licence or authority granted by Mr Cummings or Tanmari in any particular dealing. As I noted above, the Plaintiffs' submissions do not seek to identify any such licence or authority arising in any particular dealing. 2004 Agreement 121Several further issues turn on the 2004 Agreement. The first issue identified by the Plaintiffs is the scope of the licence under the 2004 Agreement, pleaded in paragraphs [37]-[39] of the Amended Statement of Claim. The Plaintiffs relevantly plead that: "On or about 11 August 2004, [Tanmari] granted [HSFS] a non-exclusive licence in the QSS Application including updates in the QSS Application to use, copy, market, resell and promote the QSS Application." The Plaintiffs identify a further issue arising from paragraph 37(d) of the Defence, namely whether the 2004 Agreement required Tanmari only to license QSS and all updates to customers who were purchasing a "complete turnkey solution". They also identify a question whether the licence under the 2004 Agreement was limited for seven years. 122In 2004, HSS and Tanmari entered into a further agreement titled "Quik Series Software Licence". The Plaintiffs contend that the 2004 Agreement granted HSFS an entitlement to a non-exclusive perpetual licence to use, copy, market, re-sell and promote QSS worldwide, subject to an obligation on HSFS to pay a licence fee of $1,000 for each person authorised by HSFS to use QSS for a period of seven years from 11 August 2004. There is a dispute between the parties as to whether the 2004 Agreement has a term of seven years, or that is merely the period for which HSFS is obliged to pay licence fees, so that HSFS thereafter has a licence for which no fees are payable. HSFS points out that the licence is stated to be a "perpetual licence" agreement, subject to termination provisions. 123In opening submissions, the Plaintiffs contended that the 2004 Agreement was largely abandoned by Tanmari, so far as its obligations were concerned, from 2009. The Plaintiffs also contend that: "Even though Cummings and Tanmari knew that new customers were being licensed with QSS (without Tanmari receiving the $1,000.00 licence fee) Tanmari took no step to claim payment of that money until after it sold QSS to [FIPL] and was no longer entitled to that money (because it became payable to [FIPL]." The acknowledgement in the Plaintiffs' opening submissions that new customers were being licensed with QSS without Tanmari receiving a licence fee is a matter of some significance, and it is expressly made in respect of a period prior to the expiry of the seven year period for which licence fees were payable. 124I will first note the background to and the terms of the 2004 Agreement and then turn to the issues arising in respect of the 2004 Agreement, as identified by the Plaintiffs. As I noted above, Stramit terminated negotiations for an exclusive arrangement in July 2004 and Mr Pacione's evidence is that HSFS no longer required exclusivity from Tanmari and that he drafted a non-exclusive licence agreement which he provided to Mr Cummings and Tanmari (Pacione 26.10.12 [44] - [45]). It appears that licence agreement was in fact drafted by a firm of New Zealand lawyers on Mr Pacione's instructions. 125Recital A of the 2004 Agreement records that the Licensor (Tanmari) is "the owner ... of the Software", and the definition of the term "Software" in this agreement broadly corresponds to that of "The Goods" in the 2002 Agreement and the "Licensed Goods" in the Exclusivity Agreement, as: "The software package referred to as Quik Series Software and includes Quik Roof, Quick [sic] Truss, Quik Frame and Quik Floor owned by [Tanmari] and also includes the know how, methodology and trade secrets necessary for the implementation of the Software." That definition is, as I have noted above, inconsistent with an assertion of ownership of the software or the copyright in it by JRC. 126Recital B records that the agreement is an exclusive licence within Australia. Recital C recorded that the parties wished to enter the QSS Software Licence Agreement to record the terms of a grant by Tanmari to HSFS of a non-exclusive licence to use, copy, market, resell and promote the Software (as defined) in the Territory, as defined. The "Territory" is defined as "the world other than Australia, subject to clause 2.5", and cl 2.5 provides that the territory includes Australia on termination or expiry of the Exclusivity Agreement. After termination of that agreement on 31 March 2005, HSFS therefore had a non-exclusive licence to in respect of QSS, including Australia, under the 2004 Agreement. 127I should set out cll 2.1 and 2.2 of the 2004 Agreement in full, since they are of particular importance in these proceedings: "2. LICENCE OF THE SOFTWARE 2.1 Grant of licence In consideration for the sum of $1.00 paid by the Licensee [HSFS] to the Licensor [Tanmari], the receipt of which is hereby acknowledged, [Tanmari] hereby licences to [HSFS], and [HSFS] hereby accepts a non-exclusive, perpetual (subject to clause 8) [dealing with termination] licence to use, copy, market, resell and promote the Software in the Territory. 2.2 Right to use [HSFS] shall be entitled to grant to its customers the right to use the Software for their internal business purposes only, provided that for the period of 7 years following the date of this Agreement only the following terms shall apply: (a) [HSFS] shall under the terms of its agreements with such customers limit the number of persons within the customer's organisation who will be authorised to use the Software; (b) For each person authorised by [HSFS] to use the Software under paragraph (a) above [HSFS] shall pay to [Tanmari] the sum of $1,000.00; (c) Payments due under paragraph (b) above in respect of each authorised person shall be made within 30 days following the date such authorised person is first authorised by [HSFS] to use the Software; and (d) [HSFS] may provide to each person authorised by [HSFS] to use the Software under paragraph (a) all New Releases or Updates as and when they become available and without being required to make any further payment to [Tanmari] under this clause 2.2. For the avoidance of doubt, following the period of 7 years after the date of this Agreement [HSFS] shall be entitled to grant to its customers the right to use any number of copies of the Software for their internal business purposes only, and may provide such customers with all New Releases and Updates, without being obliged to make any further payments to [Tanmari] under this clause 2.2." There is a question whether the reference to "customers" in this clause was a continuing permission to provide copies of QSS, including to new customers introduced after the end of that seven year period. 128Clauses 2.2(d) (to which I have referred above), 2.3(c) and 2.4 of the 2004 Agreement in turn deal with the provision of "New Releases" and "Updates" as defined to HSFS. Clause 2.2(d) allowed HSFS to provide New Releases or Updates (as defined) "as and when they become available" but does not itself impose any obligation on Tanmari to provide them. By cl 2.3(c), Tanmari represented and warranted that: "The Software is, and all New Releases and Updates of the Software will be compatible with the operating platform known as IntelliCAD version 4, or such future version of IntelliCAD or such other operating platform as the parties may agree in writing." (Emphasis added) I will address the effect of this clause further below. Clause 2.4 provided that: "[Tanmari] shall offer [HSFS] all Updates and New Releases immediately they become available, without further charge. [HSFS] shall not be obliged to accept an Update or New Release." 129The terms "New Release" and "Update" used in these clauses are defined in cl 1.1 as follows: "'New Release' means software which has been developed by [Tanmari] for general release to its customers primarily to provide an extension, alteration, improvement or additional functionality of the Software. 'Update' means software which has been produced by the [Tanmari] primarily to overcome defects in the Software." 130Clause 2.5 in turn provided that: "The parties agree that this document replaces any current licences and licensing conditions issued with, or in relation, to the Software, with the exception of the Exclusivity Agreement, to the intent that the exclusivity granted under the Exclusivity Agreement within Australia shall continue until the termination or expiry of the Exclusivity Agreement. Following termination or expiry of the Exclusivity Agreement for any reason other than for breach of the Exclusivity Agreement by [HSFS], the term "Territory" in this document shall be deemed to include Australia, but [HSFS] shall not be liable to make any payments to [Tanmari] under clause 2.2 of this document in respect of any rights granted by [HSFS] in Australia prior to the termination or expiry of the Exclusivity Agreement." 131Clause 4.1 of the 2004 Agreement in turn allowed HSFS to request Tanmari to provide development services in relation to the software and contemplated the entry into a specified form of Development Agreement in respect of such a request. Development Agreements were entered into, pursuant to cl 4.1 of the 2004 Agreement, in relation to customers of HSFS including Stramit, BNBM and HCL (Pacione 26.10.12 [48]-[50]). Mr Pacione's evidence is that, from October or November 2006, Mr Cummings took the view that he would not sign more agreements and suggested that Mr Pacione send a purchase order for each development job (Pacione 26.10.12 [57]). 132Clause 5 required the parties to enter into an escrow agreement with a reputable escrow agent, on terms acceptable to HSFS, in relation to the source code of the Software and all Improvements (as defined). That clause identified the terms on which the escrow agreement would provide for the release of the source code by the escrow agent to HSFS. Clause 7.1(e) in turn contained a warranty by Tanmari that it was the legal and beneficial owner of all Intellectual Property Rights (as defined) in the Software (emphasis added). The term "Intellectual Property Rights" was in turn defined to include patent rights, know-how, copyright and design rights. Once again, there is no suggestion that HSFS, or Mr Pacione who signed the document on its behalf, took any objection to the accuracy of that warranty, notwithstanding that it would not have been accurate if JRC in fact owned the copyright in QSS under the 2002 Agreement, even on a non-exclusive basis. 133Clause 8.1 permitted Tanmari to terminate the 2004 Agreement immediately if HSFS failed to pay the licence fee as set out in cl 3 of the agreement and that failure was not remedied within 21 days following receipt of a written notice from Tanmari requiring that non-payment to be remedied. Clause 8.2 provided for the consequences of termination, including termination of the non-exclusive licence, with specified exceptions. The Defendants contend that the 2004 Agreement included an implied term that HSFS would properly account for its licensing activity. 134Clause 10 contained a provision for the resolution of disputes under the 2004 Agreement, which contemplated the use of informal dispute resolution techniques such as mediation or expert evaluation or determination and, absent agreement as to the dispute resolution technique and procedures and other matters, then mediation in a specified manner. Clause 13.2 in turn provided that: "Neither party may assign or transfer its rights or obligations in this document or its rights, title and interest in the Software without first obtaining the written consent of the other party, such consent not to be unreasonably withheld. The proposed assignee's lack of experience shall be reasonable grounds for withholding consent." 135Clause 13.6(a) of the 2004 Agreement provides that it is intended to replace any previous understanding, agreement, representation or warranty relating to the subject matter of the agreement. Scope of licence under 2004 Agreement (Amended Statement of Claim [37] - [39]) (Plaintiffs' issues 17-18) 136The first issue identified by the Plaintiffs is directed to the question whether if (as I have held), JRC did not have a non-exclusive licence under the 2002 Agreement that included the right to use all QSS updates that has not terminated, the 2004 Agreement was limited so as only to require HSFS to license QSS and updates to it to customers who were purchasing a "complete turnkey solution" (Defence [37(d)]). 137The Defendants contend that a principal objective of the business of HSFS was that QSS would be supplied together with rollforming machines supplied by Hayes International Ltd and that QSS and the rollforming machines were to be sold as a single package, referred to as a "turnkey system". The Defendants contend that the 2004 Agreement contemplated that HSFS could sub-license QSS only in connection with the supply of a rollforming machine, where it was entered in the context of the joint venture with Bradbury International which supplied such machines, since otherwise HSFS would potentially be a direct competitor with Tanmari or Mr Cummings in the licensing of QSS. I accept that the agreement was entered in that context. However, it does not seem to me that the terms of the agreement impose such a limitation. 138The Plaintiffs respond that the language of 2004 Agreement grants HSFS the right to sub-license QSS to its customers, but otherwise does not restrict the scope of the rights and, in particular, does not expressly limit the licence to a "turnkey" solution. There is a further dispute, which it is not necessary for me to resolve, as to the scope of the restriction on HSFS's business under its Shareholder Agreement with Bradbury International. The Plaintiffs also point out, and I accept, that the internal arrangements between JRC and Bradbury International could not be characterised as the surrounding circumstances "known to the parties" in respect of the 2004 Agreement because there is no evidence that Mr Cummings or Tanmari knew of any suggested restriction to the scope of HSFS's activities. Even if such a restriction in HSFS's business had existed and had been known to both parties, that would not have supported narrowing the 2004 Agreement in a manner not supported by its terms. 139The next issue identified by the Plaintiffs is whether the licence under the 2004 Agreement was limited for seven years. I set out the terms of the "right to use" under cl 2.2 of the 2004 Agreement in paragraph 127 above, and noted that there was a question whether that reference to "customers" in that clause extended to new customers introduced after the end of the seven-year period. It is clear that the licence granted by that clause was perpetual, as cl 2.1 provided, and did not itself terminate during the seven-year period. Each of the provisions in paragraphs 2.2(a)-(d) apply only in the seven-year period, including the requirement that HSFS limited the number of persons within the customer's organisation authorised to use the software and pay the licence fee. It seems to me that clause provided the right to grant a licence to new and existing customers of HSFS within that seven year period, subject to the relevant restrictions and licence fee requirement. 140The question then arises as to the scope of the licence granted after the expiry of the seven year period. There are matters that might support a view that the reference to "customers" in the last paragraph of cl 2.2 is to existing customers of HSFS, at the end of that seven year period, and not to new customers after that date. I note that cl 9.1(d) of the 2004 Agreement distinguishes between an existing customer of HSFS, described as a "customer", and a "prospective customer", and the reference to "customer" in cl 2.3 should be read as directed to the former. However, that does not determine the question whether a person is only a "customer" if he or she meets that description at the end of the seven year period or if that is determined from time to time after the end of that period. 141The narrower view of that clause would preserve HSFS's and its customers' ability to use HSFS under rights granted in that seven year period, and allow incremental expansion of that right so far as additional persons within the customer organisations are permitted to use the software after the expiry of the seven year period. The wider view has the result that Tanmari and Mr Cummings, at the end of the seven year period, authorised HSFS to grant as many licences as it wished to as many persons as it wished within new customer organisations without payment of any licence fee to Tanmari or Mr Cummings and indefinitely into the future. That wider reading might reflect a commercial bargain that, after paying licence fees for seven years, HSFS should be allowed a continuing licence at no further charge. On the other hand, that wider reading could confer a windfall on HSFS, particularly where the initial fee paid under the 2004 Agreement was nominal ($1.00) and HSFS had not committed to payment of any minimum amount of licence fees in that seven year period. 142With considerable hesitation, it does not seem to me that the terms of cl 2.2 are sufficient to support the narrower reading of the clause. On its natural meaning, the phrase "customers" of HSFS refers to customers from time to time, and that terms should be given the same meaning within and after the seven year period. I do not consider that the terms of the clause are sufficient to, in effect, read into the last paragraph an additional limitation that the reference to "customers" is to HSFS's customers at the end of the period. 143The Defendants refer to several matters which they submit are post-contractual admissions by Mr Cummings and Tanmari that the 2004 Agreement remains in effect. These include a reference to the 2004 Agreement in the FIPL Purchase Agreement; that the notice of breach and termination of the agreement proceeded on the basis that the 2004 Agreement was on foot; and that the Defendants' Cross-Claim pleads that the second agreement is held on trust, which suggests that it has not expired. The first and second of these matters are equivocal, since the 2004 Agreement is on any view on foot to the extent that it confers continuing use rights on existing customers of HSFS, at the end of the seven year period as I have held above. Each of those matters otherwise depends on the question of law as to the proper construction of the 2004 Agreement and, if admissible, I consider they have little weight. 144For these reasons, I do not find that the licence under the 2004 Agreement was limited to seven years or to existing customers of HSFS at the end of that seven-year period. Termination of 2004 Agreement (Amended Statement of Claim [75] - [77]) (Plaintiffs' issue 19) 145The next issue identified by the Plaintiffs is whether Tanmari properly terminated the 2004 agreement. The Plaintiffs plead that a termination of the 2004 Agreement by Tanmari by letter dated 24 January 2012 from Tanmari's solicitors, Sparke Helmore, to HSFS's solicitors, Simone Legal, was not effective. The Plaintiffs particularise a range of matters to support that allegation, including a claim that the relevant notice was not given in accordance with cll 8 and 12 of the 2004 Agreement. 146The parties identify numerous sub-issues which they contend arise in respect of this issue, namely, whether HSFS was in a breach of the 2004 Agreement which remained unremedied; whether HSFS failed to pay Tanmari all outstanding licence fees; whether non-payment of licence fees was abandoned by Tanmari; whether HSFS sublicensed SFSI to grant licences in QSS; whether SFSI received any rights from JRC under the 2002 Agreement; whether SFSI's conduct was attributable to HSFS; if SFSI's conduct was attributable to HSFS, whether HSFS received consent from Tanmari to assign its rights to SFSI; if SFSI's conduct is attributable to HSFS, and HSFS did not receive consent from Tanmari to assign its rights to SFSI, whether Tanmari contributed or caused any breach by HSFS by unreasonably withholding consent to an assignment, so Tanmari cannot take advantage of its own conduct to terminate; whether notice of the breach and notice of termination was properly served; whether the dispute resolution procedure in the 2004 Agreement was mandatory; and whether Tanmari was entitled to terminate the 2004 Agreement where Tanmari had assigned the 2004 Agreement to FIPL. Not all of these issues were addressed by substantive submissions, and I will address below those that are material to the determination of the proceedings. Whether HSFS was in breach of the 2004 Agreement by reason of non-payment of licence fees 147Under cl 8.1 of the 2004 Agreement (Ex P2 112), Tanmari is entitled to terminate the agreement for HSFS's failure to pay licence fees if Tanmari gives notice of the failure and the failure is not remedied within 21 days. 148At about the time that SFSI commenced licensing QSS to new customers, in about April 2009, Mr Pacione decided to cease to undertake new business in HSFS and instead to undertake new business in SFSI. So far as evidence as to the grant of licences after April 2009 was led in the proceedings, it appears that all such licences were granted by SFSI (Ex D4, Tab 1, Schedules). Mr Pacione's evidence in cross-examination as to HSFS's activities since April 2009 was not entirely clear. His evidence was initially that: "SFSI, as I mentioned before, is issuing renewals for existing licences for all customers. Obviously [HSFS] isn't an operating entity anymore, even though it still exists. Everything is done out of SFSI for business operations, and that includes licensing customers of [HSFS] that appear on the first page of that schedule [Ex D4] that aren't required to pay annual fees as well. They are all annually relicensed." (T97) Mr Pacione's further evidence in cross-examination was that, by April 2009, SFSI had taken over the licensing, which he then qualified to indicate that was for new licences, but that HSFS "had an existing customer base worldwide, and with those customers came obligations" (T131). Mr Pacione then indicated that, from April 2009, SFSI took over as the licensor of QSS for "new, non-existing licences" (T132). Mr Pacione then suggested, inconsistently, that HSFS both "continued and slightly wound down" and that "it is just not really doing anything", as follows: "Q. You don't make it clear in this first affidavit that [SFSI] is taking over from [HSFS] as the licensor - A. Well, when it came to new licences but what you have read there, Ms Goddard, is about the development of the product and [HSFS] didn't hit a brick wall and stop. It continued and slightly wound down. We did exhibitions after this time and advertised [HSFS], [HSFS] just didn't drop away. Q. So, when [HSFS] continued until - what time do you say? A. It is still there, it is just not really doing anything. It is dormant, if I can put it that way. ... If I decided to trade from it, if [HSFS] had a purpose to do something I guess it would." Doing the best that I can with this evidence, it seems to me that HSFS had at least ceased to deal with new clients and substantially ceased all its business from April 2009, but may have had a residual business renewing licences granted to previous clients, the extent of which is unclear. 149HSFS stopped paying licence fees to Mr Cummings or Tanmari in respect of QSS possibly by February 2009, and certainly by April 2009, and Mr Pacione took the position in cross-examination that SFSI was not required to pay such licence fees (Ex D4, item 15, T95, 111-114, 129-130). The Defendants also submit that Mr Liu, who dealt with Mr Cummings on behalf of SFSI, used a different email address in communication with Mr Cummings and that the Court should infer that he was trying to suppress the identity of SFSI as the licensing entity of QSS as well as the identity of new customers to whom licenses were granted (Ex P7/Tab 4/Annexures "B" to "F" at 16-32, Annexure "G-R" at 32-36, Annexure "S" at 37, Annexure "T-BB" at 42, 46; Annexures "CC-OO" at 50-51). Mr Liu denied that suggestion when it was put to him in cross-examination. There were many occasions on which Mr Liu used that separate email address and several occasions on which he used an email address that referred to SFSI. I do not consider it necessary to determine this matter in order to decide this issue given the other findings that I have reached. 150By letter dated 21 December 2011 from solicitors acting for Mr Cummings and Tanmari to solicitors acting for HSFS (and Mr Pacione), Mr Cummings and Tanmari gave notice that they required HSFS to remedy all breaches of the 2004 Agreement including paying all outstanding licence fees within 21 days, by 11 January 2012. FIPL also sent a notice of breach on 21 December 2011 (Taylor 31.10.13 [46], Annexure SMTH, Ex P7, 6/Tab 10). 151By letter dated 6 January 2012, the Plaintiffs' solicitors responded that: "[HSFS] acknowledges its liability to your client for Licence Fees for each Licence granted prior to August 2011 at the rate of $1000.00 per licence as specified in the 2004 Agreement. On this basis, our client calculates that 19 new licences have been granted. Notwithstanding our view that your client is itself in breach of contract, we enclose herewith, without admission, our client's cheque in the amount of $20,900 (inclusive of GST)." Mr Pacione accepted in cross-examination that this payment did not include any of the licences granted by SFSI, in purported reliance on a sub-licence granted by JRC under the 2002 Agreement. The Defendants submit that the 19 licences did not on any view represent the totality of the licences granted by interests associated with Mr Pacione, and specifically SFSI for QSS, and that proposition is established by Ex D4. However, as I will note below, HSFS was not required to pay royalties in respect of licences that it had not in fact granted. 152By letter dated 24 January 2012 from their solicitors to the Plaintiffs' solicitors, Mr Cummings and Tanmari purported to terminate the 2004 Agreement, effective immediately (Taylor 31.10.13 [85], Annexure SMTR, Ex P7, 6/Tab 10). FIPL also sent a notice of termination on 24 January 2012 (Ex D9, Tab 1), although it had not previously given notice of any breach of the 2004 Agreement. 153By a further letter dated 23 May 2014, without admission as to the effectiveness of the earlier notices to remedy the breaches and termination notices, Tanmari and FIPL terminated the 2004 Agreement for non-payment of licence fees and terminated any licence, authorisation or authority to JRC, HSFS, SFSI or Mr Pacione to do any of the acts comprised in the copyright in QSS or the user documentation. 154The Plaintiffs submit, first, that Tanmari's termination of the 2004 Agreement was not effective because it was based on HSFS not paying licence fees to Tanmari under the 2004 Agreement, and HSFS had remedied any failure to pay licence fees when, on 6 January 2012, its solicitors sent a letter to Tanmari's solicitors enclosing a payment of unpaid licence fees (Ex P2 373). 155The Defendants contend that they were entitled to terminate the 2004 Agreement for failure by HSFS to pay licence fees to Tanmari as and from 2009 and for the purported transfer of the rights to license QSS to SFSI, without the knowledge or consent of Mr Cummings or Tanmari. That proposition assumes that HSFS in fact transferred such rights to SFSI. 156The Defendants at one point submitted that the amount then paid was not the full amount of licence fees outstanding because it was not "per person", or did not cover all licences granted by HSFS. The Plaintiffs submit that the fees they paid were paid on a per person basis, and there are seven licences for one customer, BNBM Homes, and 12 licences for another customer, BNBM Group (Ex D4, Tab 1, QSS Licence Schedule dated 11 March 2013, items 42 and 43). They submit that there is no evidence that HSFS granted any other licences and did not pay licence fees for those licences. However, the Defendants did not identify evidence to support that submission of non-payment in respect of licences granted by HSFS when I requested further submissions as to that matter following the hearing. It does not seem to me that a breach has been established in respect of licence fees payable in respect of licences granted by HSFS, as distinct from licences granted by SFSI. The Defendants did not submit that a payment of unpaid licence fees, without an undertaking not to repeat the breach, was not sufficient to cure the relevant breach and it is therefore not necessary to address the complexities that would have arisen had such a submission been made, having regard to cases such as Tricontinental Corporation Ltd v HDFI Ltd (1990) 21 NSWLR 689 at 722-723 per Wardell AJA and Burger King Corporation v Hungry Jack's Pty Ltd [2001] NSWCA 187; (2001) 69 NSWLR 558 at [120]ff. 157The Plaintiffs submit that no breach arose from their admitted failure to pay licence fees in respect of licences granted by SFSI because, they submit, HSFS is not required to pay licence fees under the 2004 Agreement where SFSI granted the relevant licences, and that SFSI is not exercising rights under the 2004 Agreement but instead exercising rights sub-licensed to it by JRC under the 2002 Agreement. The Plaintiffs make clear that they do not contend that SFSI is using rights under the 2004 Agreement, and correctly point out that that is the premise of the Defendants/Cross-Claimants' claim for breach of copyright against SFSI. 158The Defendants conversely submit that: "... to the extent that [HSFS] authorised this conduct [ie the grant of licences by SFSI], it constituted breaches of the 2004 Agreement entitling Tanmari and Mr Cummings to terminate the 2004 Agreement and to revoke any licence of QSS including for: a failing to pay any licence fees to Tanmari as and from April 2009; or b (if this indeed happened) purporting to transfer rights to license QSS to SFSI, without the knowledge or consent of Mr Cummings or Tanmari. By this device, also, [HSFS] by its director Mr Pacione sought to avoid the obligations under the 2004 Agreement." 159I do not accept this submission. I have referred above to cl 2.2 of the 2004 Agreement, which authorised HSFS to grant its customers the right to use the software and required HSFS to pay Tanmari the amount of $1000 for each person authorised by HSFS to use the software. That payment obligation depended on the grant by HSFS of the relevant right to its customers. The Plaintiffs' case is that SFSI, not HSFS, granted that right and it did not do so under the 2002 Agreement. There is no evidence to the contrary and it is not implausible that SFSI either granted rights in reliance on the 2002 Agreement (as the Plaintiffs contend) or without any basis to do so (as the Defendants contend in their Cross-Claim). The terms and conditions of the licences granted by SFSI to customers refer to dealings with SFSI and invoices to customers appear to have been issued by SFSI (although a minority also refer to HSFS). Even if HSFS is held to the admission in the earlier Statement of Claim that SFSI was acting as its agent, a grant of a licence to a customer other than under the 2004 Agreement did not give rise to an obligation to pay a licence fee under that agreement. 160The fundamental difficulty with the Defendants' submission is therefore that HSFS was not obliged to pay licence fees to Tanmari other than in respect of licences that it had granted. It generally did not grant such licences from April 2009, after Mr Pacione as its director diverted its business to SFSI. There is no evidence that HSFS purported to transfer its rights to license QSS to SFSI. Although I do not find that JRC granted a sub-licence to SFSI in April 2009, as the Plaintiffs contend, that does not lead to the conclusion that some other transaction took place, where the Plaintiffs do not contend that any other transaction took place and the alternative conclusion that SFSI simply dealt with the software without any right to do so is plainly open. 161For these reasons, a continuing breach of the 2004 Agreement by reason of non-payment of licence fees is not established. Whether SFSI is exercising rights under the 2002 Agreement 162As I noted above, the Plaintiffs also identify a sub-issue whether SFSI obtained its rights from JRC under the 2002 Agreement. I have held above that the 2002 Agreement had been abandoned and ceased to have effect well before the suggested grant of rights under it by JRC to SFSI in April 2009 and that is sufficient to dispose of this subissue. I should, however, also address Mr Pacione's affidavit evidence that JRC (acting through him) granted rights to SFSI (also acting through him) under the 2002 Agreement after April 2009. The suggested sub-licence is not in writing and its terms were not identified. 163The Plaintiffs point out, and I accept, that a person may make an agreement between himself and a company which he or she controls, or by extension, two companies which he or she controls, in an informal way: see, for example, Gram Engineering v Bluescope Steel above at [401]-[402]. However, the Court may be less readily satisfied that a commercial transaction in fact took place in that manner where, as here, there is no evidence of any consideration given to its terms and no identification of what they are. I am by no means satisfied, for the reasons noted below, that Mr Pacione in fact granted an informal sub-licence to SFSI in April 2009 in reliance on its rights under the 2002 Agreement or that the terms of any such grant (which were not identified by the Plaintiffs) were sufficient to authorise SFSI's sub-licensing of QSS to third parties after that date. 164Mr Pacione's initial evidence (Pacione 26.10.12 [76]) as to the entry into the licence between JRC and SFSI was no more than a conclusory assertion, admitted without objection, that: "In April 2009 I determined on behalf of [JRC] to licence SFSI to use Quik Series Software and did so." This evidence is striking for its lack of specificity, as to when in April 2009 that decision was made and as to the terms of any licence, including the particular rights that comprised any ability of SFSI to "use" QSS. The language of "use" might also be apt to reflect a permission for SFSI to use QSS for its own use, rather than a sub-licensing arrangement by which SFSI was entitled to grant new licences to its own customers. 165In reply, Mr Pacione somewhat expanded on the circumstances of the suggested assignment from JRC to SFSI, but not on its terms, as follows: "Following [Tanmari's] refusal to discuss any issue relating to any agreements with [JRC] and [HSFS], in or about April, 2009, I decided that [JRC] could and would provide SFSI with sub-licensing rights, given the rights acquired by [JRC] pursuant to the 2002 Agreement. I was of the view that this allowed SFSI to licence new customers and/or users of the QSS program and that this also allowed [HSFS] to continue to licence new customers and/or users of the QSS program via the 2004 Licence." (Pacione 28.1.13 [59]) 166Mr Pacione's oral evidence-in-chief, by leave, was that he decided to grant the licence by JRC to SFSI in April 2009 in his capacity as a director of those companies (T66-67). Mr Pacione gave further evidence as to the grant of the suggested licence in cross-examination as follows (T66-67): "Q. How do you say that any such licence was granted? A. Well, I decided myself to grant that licence. Q. At the time that you say, first of all, can you tell his Honour when you made that decision? A. That decision was made around April 2009. Q. When that decision was made, in what capacity or capacities were you making that decision? A. I was making that decision as directors of the companies concerned. Q. Just for completion, the companies concerned are? A. As director of JRC and SFSI." Mr Pacione was further cross-examined as to this issue as follows (T141 - 142): "Q...you gave evidence about the circumstances under which you decided to grant the licence to SFSI. Do you recall that? You said you made that decision around April 2009? A. Yes. Q. There's no document, as I think you've agreed, recording that licence, is there? A. No, there is not. Q. How do you say it occurred? Was it something that you what, you had a conversation with yourself, or how did you say that happened? A. Yeah, I - well, yes is the short answer. I decided because there were no other partners involved and it was me that was in charge and an owner of those companies, I didn't feel I needed to actually document in the same way that I did with JRC and Hayes SFS where I had a known minority position and an American partner. I didn't feel I needed to do it the same way." 167The correspondence between the parties before and after April 2009 does not refer to a sub-licence granted by JRC to SFSI in reliance on its rights under the 2002 Agreement. The Plaintiffs do not suggest such a sub-licence was granted at any other time. The case law indicates that the Court may have reference to subsequent dealings between parties to determine whether an oral agreement exists, as distinct from questions of constructions in respect of such an agreement. In Lym International Pty Ltd v Marcolongo [2011] NSWCA 303 at [143], Campbell JA observed that: "... the task in ascertaining what are the terms of a contract that is not wholly in writing ... is finding as a fact what the parties have agreed. A range of postcontractual conduct could be relevant to ascertaining what the parties have agreed. For example, their conduct in carrying out the contract could itself be objective evidence of what they had agreed, an admission of one of the parties could assist in ascertaining what they have agreed, and business records created to record or report on the contract rather than carry it out could also assist in that task." In Hightime Investments Pty Ltd v Adamus Resources Ltd [2012] WASC 295 at [98]-[99], Edelman J similarly observed that: "... subsequent conduct is a relevant matter to consider in finding whether, as a fact, the alleged oral promises were made. Mears v Safecar Security Ltd [[1983] QB 54, 77], Stephenson LJ (with whom O'Connor LJ and Sir Stanley Rees agreed) said: I have already expressed my view that this agreement was oral, but even if it was partly in writing, we are concerned with the search for a term that was not written down, and there is nothing in those authorities which prevents the court from looking at the way the parties acted for the purpose of ascertaining what that term was. Common sense suggests that their subsequent conduct is the best evidence of what they had agreed orally but not reduced to writing, though it is not evidence of what any written terms mean. This passage was approved by Owen J in The Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9)[[2008] WASC 239 at [2668]] and the latter half was quoted with approval by Murphy JA (Pullin & Newnes JJA agreeing) in Fazio v Fazio [[2012] WASCA 72 at [192]-[195]]. The statement by Stephenson LJ is consistent with statements in a number of other cases. Spigelman CJ has also described post-contractual conduct as a matter of "significant weight" in identifying the subject matter of an alleged oral contract [County Securities Pty Ltd v Challenge Group Holdings Pty Ltd [2008] NSWCA 193 at [24]]. This approach also accords with principle. It would be peculiar if courts were to be constrained in the exercise of finding facts from considering any relevant matter subsequent to the alleged occurrence of the fact in issue." This principle has been applied in respect of an inferred agreement in Fazio v Fazio [2012] WASCA 72 at [193] per Murphy JA (with whom Pullin and Newnes JJA agreed). It seems to me that principle is no less applicable where the Plaintiffs rely, not on an oral agreement, but on an agreement said to have been formed by Mr Pacione within his own mind in his two capacities as a director of JRC and SFSI. It seems to me that, to adopt the language of Edelman J in Hightime Investments above, it would indeed be peculiar if the Court could not look to whether what Mr Pacione, JRC and SFSI subsequently said and did was consistent with the agreement Mr Pacione said had been formed in April 2009 in order to determine whether his evidence as to that matter should be accepted. 168Prior to the suggested sub-licence from JRC to SFSI, Mr Pacione had raised various possible licence arrangements with Mr Cummings about this time, but none of them involved a licence by JRC to SFSI relying upon the 2002 Agreement. By email dated 30 May 2008 (Ex P5), Mr Pacione suggested to Mr Cummings that a new licence agreement be entered into in respect of QSS between SFSI and Tanmari. That email noted that the attached licence agreement was the same as Mr Cummings had seen before - presumably in the 2004 Agreement - other than for non-solicitation and naming rights provisions in cll 2.4 and 2.5 and the draft agreement increased the price per licence to $1,250, and Mr Pacione's covering email offered to provide for a minimum of five licence bundles. The proposed cl 2.5 would have prohibited Tanmari knowingly approaching, soliciting or supplying QSS to any customer of SFSI without SFSI's written consent, and a similar provision was found in the 2004 Agreement in respect of HSFS. Clause 5 would have permitted SFSI to promote or resell the software under such name, logo or other reference as it chose, subject to Tanmari's written consent which could not unreasonably be withheld. 169By an email dated 8 March 2009, which also dealt with escrow issues to which I will refer below, Mr Pacione referred to his intention to assign the "existing licence" to JRC and sought consent to that assignment. That email necessarily referred to the 2004 Agreement, since there would be no need to assign the 2002 Agreement to which JRC was party to itself. A further email from Mr Pacione to Mr Cummings dated 20 March 2009 again referred to a suggested assignment of the licence agreement to JRC which was described as "just an inter-company thing" so that JRC would have the licence and not HSFS, and offered to explain the reasons for that assignment. That email is also necessarily directed to an assignment of the 2004 Agreement, given the reference to HSFS as the existing licensee and the fact that there was no need to assign the 2002 Agreement to which JRC was already party to itself. 170Mr Cummings' evidence is that, when he received a request from Mr Pacione to assign the 2004 Agreement to JRC, he was not aware of the reason for that assignment because Mr Pacione did not explain it to him (Cummings 4.12.12 [117]). His evidence was also that he was then receiving new requests from Mr Pacione to develop QSS to meet new arrangements between HSFS and new customers, for which he had not received licence fees (Cummings 4.12.12 [118]). Mr Cummings' evidence in cross-examination was that, when he had numerous emails from Mr Pacione seeking to transfer the interest to several entities and did not know what was going on, he was "distrustful so [he] just sat back and done nothing" (T259). Mr Pacione responds to that evidence by referring to an email dated 20 March 2009 (Ex P7 3/324) as the explanation of the reason for the assignment. That email provides no real explanation of either the purpose or the commercial effect of the suggested assignment. 171An email dated 3 April 2009 from Mr Pacione (Ex P7, 3/332) refers to CNC outputs for products to match with Howick machines and to a request for a licence transfer to SFSI and for QSS to be "marketed back into SFS customer base". It seems to me this email must also refer to the 2004 Agreement, since emails before and after it refer to that agreement rather than the 2002 Agreement. Mr Cummings (Cummings 4.12.12 [121]) refers to a conversation with Mr Pacione in words to the effect that: "Cummings: "Where are the sales that go with these requests? Pacione: There haven't been any sales." Mr Cummings' evidence is also that, to his knowledge, none of HSFS's existing customers were then using Howick machines; he was concerned with matters raised in that email, including two matters that appeared to be requests for modifications of QSS for new customers; and he had not previously received a request for a licence transfer to SFSI or for QSS to be "marketed back into SFS customer base" (Cummings 4.12.12 [122]). 172Mr Pacione denies the conversation and adds, in reply that: "All customers up until April 2009 were licensed by [HSFS] under the 2004 [Agreement], and all customers licensed after April 2009 were licensed by SFSI via the sub-licensing rights given to SFSI by [JRC] under the 2002 Agreement." (Pacione 28.1.13 [62]) There seem to me to be several difficulties with Mr Pacione's evidence in this regard. First, it seems to me likely that Mr Cummings would have in fact recognised that requests for compatibility with a brand of machine not used by existing customers of HSFS would indicate that there were customers of which he had not been informed and had not received licence fees and would make inquiry as to that matter. Mr Pacione's denial of the conversation relates not only to the answer he gave, but also to the fact of that inquiry. Second, the email appears to support the view that, prior to April 2009, customers were using Howick machines and there was no evidence contrary to Mr Cummings' evidence that they were not customers of HSFS. Mr Pacione's evidence does not explain how, prior to April 2009, those customers came to be licensed without HSFS paying the requisite fees to Tanmari, where the suggested sub-licence given by JRC to SFSI did not come into existence in April 2009. Third, Mr Pacione's explanation again highlights the lack of precision in the reference to "April 2009" as to when the suggested sub-licence was given by JRC to SFSI. 173Mr Pacione's evidence is also that, in April 2009, JRC and HSFS "were, at the time, deciding on the best course of action and wished to discuss the options of assigning the rights of the 2004 Licence [held by HSFS] to either [JRC] or SFSI" and that issue was to be discussed at the meeting at Sydney Airport on 6 April 2009 (Pacione 28.1.13 [58]). That issue is recorded on the agenda for that meeting. 174By email dated 19 April 2009, Mr Pacione advised Mr Cummings that, if he had not heard from Mr Cummings by the end of the week, he would transfer the rights to JRC and also again referred to the escrow agreement, which I will address below (Ex P2, 190). That email also referred to the 2004 Agreement since, as I noted above, there would be no need to assign the 2002 Agreement to which JRC was party to itself. 175On 1 May 2009, Mr Pacione sent a further email to Mr Cummings (Ex P7, 3/335) noting that some of the items raised with Mr Cummings at their meeting at the airport "have grave commercial consequences for us" and indicating the view that it is "only fair and reasonable to expect you to honour current obligations from the contracts we have in place". That email did not refer to any sub-licence by JRC to SFSI that, on Mr Cummings' evidence, had already been granted. Mr Cummings' evidence is that was the last email he received from Mr Pacione, although he later received further communications from Mr Liu in respect of technical issues after May 2009 (Cummings 4.12.12 [125]-[126]). There is therefore no contemporaneous notification to Mr Cummings of any sub-licence given by JRC to SFSI, as well as no contemporaneous documents created by JRC, SFSI or Mr Pacione referring to such a sub--licence and, it appears, no reference to such a sublicence in licence agreements subsequently granted by SFSI to its customers (Ex D4). A further letter dated 18 November 2011 from the solicitors acting for the Plaintiffs to Mr Cummings (Ex P2, 349) referred both to the 2002 Agreement and the 2004 Agreement and also dealt with the question of escrow arrangements, but also did not refer to any sub-licence of JRC's rights under the 2002 Agreement to SFSI, notwithstanding that it appears by that time that SFSI rather than HSFS was undertaking the bulk of licensing activity. 176It was squarely put to Mr Pacione in cross-examination that the suggested sub-licence by JRC to SFSI is a retrospective attempt to provide a basis for the licence to SFSI which would not give rise to an obligation to pay royalties under the 2004 Agreement. It is not necessary for me to reach such a finding, given its character, but I am not satisfied that a sub-licence was granted by JRC to SFSI in April 2009 such as would authorise the grant of software rights by SFSI to third parties and the Plaintiffs do not suggest it was granted thereafter. I think it likely that, about April 2009, Mr Pacione did decide that SFSI would commence dealing with new customers to the exclusion of HSFS, and that is what occurred. That course could have been implemented by Mr Pacione, who was then obviously frustrated by Mr Cummings' lack of consent to the alternatives he had proposed, taking that course without considering he needed to address the legal niceties, particularly where he would have known that Mr Cummings did not have a practice of taking legal advice as to their dealings. It could have been implemented by SFSI acting as agent for HSFS, relying on HSFS's rights under the 2004 Agreement, a course that would be consistent with the Plaintiffs' pleading, in their earlier Statement of Claim, that SFSI in fact dealt with third parties in that capacity. It could have been founded on an assignment of the 2004 Agreement to SFSI, although that would have required Tanmari's consent and the Plaintiffs do not suggest it occurred. It could have occurred by an assignment or sub-licensing of rights under the 2002 Agreement, had it not been previously abandoned, to SFSI although the absence of any reference to that course before or after it is said to have occurred makes that possibility less likely. I am not satisfied, given the generality of Mr Pacione's evidence and the absence of any contemporaneous support for it, that it occurred by Mr Pacione forming an informal agreement with himself in his two capacities as director of JRC and SFSI, with sufficient specificity that it was directed, first, to the rights under the 2002 Agreement rather than the 2004 Agreement and, second, that it had the character of a sub-licence of those rights by JRC to SFSI. 177The Plaintiffs also advanced elaborate submissions as to the position if, contrary to their position, HSFS had assigned rights under the 2004 Agreement to SFSI without Tanmari's consent. I do not consider it necessary to address those submissions where the Plaintiffs do not seek to rely on such an assignment and there is no other evidence that it took place. I should note, however, that I do not consider that it would have been unreasonable for Tanmari to withhold consent to such an assignment where it would have had the result that the rights under the relevant agreement would have vested in SFSI although any obligations under it, which were not capable of assignment, would have remained with HSFS and where, arguably, SFSI could have exercised those rights without payment of licence fees since the relevant licences would then not have been granted by HSFS. I should add that I do not accept Mr Pacione's evidence in cross-examination (T113) that he would have been "happy" for SFSI to pay licence fees in that situation, although it was not obliged to do so. That evidence was inconsistent with the fact that HSFS and SFSI did not do so from April 2009, although Mr Pacione sought to explain that inconsistency by the deterioration in the relationship with Mr Cummings, and was also inconsistent with his evidence in cross-examination (T111) that Mr Cummings could have had no expectation of receiving licence fees if HSFS (or SFSI) was not obliged to pay him, presumably after the expiry of the seven-year period under the 2004 Agreement (T111). I also do not accept the Plaintiffs' associated submission, based on Mr Pacione's evidence, that: "The reason SFSI did not pay licence fees was because Tanmari had not consented to [HSFS] assigning the [2004] Agreement to SFSI and SFI [sic] denied its rights under the 2002 Agreement". Whether Tanmari had abandoned its right to terminate the 2004 Agreement for breach 178The Plaintiffs also submit that Tanmari had abandoned its right to terminate for HSFS's failure to pay licence fees because it was aware of the facts giving rise to HSFS's asserted breach of the 2004 Agreement and any consequential right to terminate that agreement and did not terminate that agreement within a reasonable time of becoming aware of those matters. It is not strictly necessary to determine this matter since I have held above that a right of termination did not arise from SFSI's grant of licences, which were not founded on rights arising under the 2004 Agreement. 179The Plaintiffs point out that Mr Cummings' evidence was that he had not received licence fees since February 2009 (Cummings 4.12.12 [102]) and was suspicious that HSFS was not paying licence fees from September 2009 (Cummings 4.12.12 [134], Cummings 14.10.13 [124]) and that Mr Cummings conceded in cross-examination that his concerns had stretched back years (T313). The Plaintiffs also submit that Tanmari elected to affirm the contract by not blocking authorisations generated by a customer licence generator previously supplied to JRC or HSFS and continuing to provide updates through its website and continuing to engage with Mr Liu, HSFS's technical support person (Cummings 4.12.12 [126]-[128]; Liu 22.10.13 [18], [22]-[23]). 180The Plaintiffs did not advance substantive submissions as to the applicable principles of abandonment, waiver, election or affirmation. I do not consider that I should seek to formulate the manner in which they would seek to establish that the facts to which they refer constitute abandonment, waiver, affirmation or election, in order to determine that claim, since the Defendants would then have had no real opportunity to answer such a formulation. I note that, in any event, that claim would have faced the immediate difficulty that Mr Cummings and Tanmari would not have knowledge of the relevant facts where the Plaintiffs had not disclosed that they were relying on a claimed sub-licence by JRC to SFSI to grant licences from SFSI without paying the amounts that would have been payable under the 2004 Agreement. The Plaintiffs have therefore not established any abandonment, waiver, election or affirmation so as to defeat the notice of termination. Service of the notice of breach and notice of termination 181There is also a sub-issue as to whether and when notice of termination of the 2004 Agreement was effectively served. By an affidavit dated 2 April 2014, the Plaintiffs' solicitor gave evidence that the notice to remedy the relevant breaches and the termination notice were sent to him rather than the address set out in cl 12 of the 2004 Agreement. The Defendants contend that this matter was not specifically pleaded. The Plaintiffs submit, and I accept, that they referred to this matter in the pleadings (in particulars (i) to paragraph 76 of the Amended Statement of Claim and the particulars to paragraph 28(d) of the Reply), although I note that those reference were not particularly transparent in disclosing the point to be taken. I will assume, without deciding, that this point was open to the Plaintiffs. 182The issue turns upon cl 12 of the 2004 Agreement (Ex P7, 3/205). Clause 12.1 provides that: "A notice, consent or other communication under this document is only effective if it is in writing, signed and either left at the addressee's address or sent to the addressee by mail or fax. ..." (emphasis added) Clause 12.2 in turn specifies both the address and facsimile numbers of Tanmari and HSFS. It seems to me that cl 12.1 identifies alternative means of service, either by delivering a document to the addressees' address or by mail or by facsimile, specifying in the former case that that document be sent to the addressee at that particular address, but in the latter case specifying only that it be sent to the addressee but not adding an additional requirement that be done at the specified address or facsimile number. 183The Plaintiffs submit, correctly, that a notice of termination under the 2004 Agreement "is only effective" if it is in writing, signed and either left at the addressee's address or sent to the addressee by mail or fax, by reason of cl 12.1 of the 2004 Agreement. The Plaintiffs submit, and I will also assume without deciding, that this is a mandatory clause and the notice is only effective if it complies with the clause: Comdox No 24 Pty Ltd v Robins [2009] NSWSC 367. However, the Plaintiffs' submission assumes, sub silentio, that the reference to the addressee's address refers not only to where the notice should be left but also to where it should be sent by mail or fax, and I do not accept that assumption. In my view, that clause permitted a notice to be sent to the addressee by mail or by facsimile, at any address at which the addressee had expressly or impliedly agreed to accept communications, and not only at the address or facsimile number specified in cl 12.2, by contrast with the provision for leaving a notice at the addressee's address which could only be effected at the address specified in cl 12.2. 184The letter sent by the solicitors for Mr Cummings and Tanmari requiring rectification of the breach and the notice of termination were sent by facsimile (Ex P2, 351, 384) and it seems to me that delivery in that manner is not limited to delivery to the specified address. The Plaintiffs also submit that the notices were addressed to HSFS's solicitors and not HSFS, but the terms of cl 12.1 of the 2004 Agreement do not prevent such notice being given to a party by its agent. In engaging a solicitor to send and receive communications on its behalf, HSFS necessarily consented to communications to it being sent to that solicitor for the purposes of the latter part of that clause. 185The Defendants also submit that the purpose of the clause dealing with the method of service was to ensure that notices under the 2004 Agreement came to the attention of the other party, and presumably to rely upon proof of service where service is factually in dispute: Al Jadeed TV v United Broadcasting International Pty Ltd [2011] FCA 983; (2011) 283 ALR 205 at [65]-[66] per Flick J. They note that the Plaintiffs do not dispute the fact of service on their solicitor and that it is clear that the notice of breach and the termination notice in fact came to HSFS's attention because responses were received to those notices on 6 January 2012 and 2 February 2012 respectively. It is not necessary to determine the effect of these matters where the issue can be determined on the proper construction of cl 12 of the 2004 Agreement for the reasons noted above. 186The Defendants also submit that the filing and serving of the Cross Claim on 29 May 2013 constitutes sufficient notice as and from that date and that, without any admissions as to the effectiveness or otherwise of the notice of breach and the notice of termination, the Defendants sent a further letter of termination on 23 May 2014 (Ex P2, 401-415). It is also not necessary to address these matters given the findings that I have reached above. Failure to comply with dispute resolution procedures 187The Plaintiffs also refer to the requirements of the dispute resolution procedure under cll 10.1-10.3 of the 2004 Agreement and refer to the decision of the High Court in PMT Partners Pty Ltd (in liq) v Australian National Parks and Wildlife Service [1995] HCA 36; (1995) 184 CLR 301 at 311-312 per Brennan CJ, Gaudron and McHugh JJ and also to Fabig v Photon Group [2010] NSWSC 358 at [10] per McDougall J. Those cases dealt with the stay of court proceedings, pending an arbitration in the former case and an expert determination in the latter and not with the termination of an agreement, and the Plaintiffs did not refer to authority dealing with the issue in respect of termination. As Fabig v Photon Group above recognised, a stay of such proceedings by reason of a failure to comply with such proceedings is a matter of discretion. Those cases do not establish any principle that a contract cannot be terminated in that situation. 188I accept that cll 10.1-10.3 of the 2004 Agreement imposed mandatory provisions, which were breached by Tanmari so far as it did not proceed to mediation as contemplated by those clauses. However, the right to terminate the 2004 Agreement for breach, after notice is provided under cl 8 of the 2004 Agreement, is not expressly limited by any requirement for previous compliance on that clause. The Defendants did not contend that such a limitation could be implied into that clause, and it does not seem to me that such a contention could have been accepted, so that, for example, HSFS could, by serving a notice of dispute, avoid or delay termination of the agreement for a failure or refusal to pay licence fees when due which it had failed to remedy after notice. Had the parties wished to achieve that result, they could readily have limited the right to terminate under cl 8 to do so. The position in that regard is quite different from the question whether, for example, Tanmari could commence court proceedings without compliance with cl 10 of the 2004 Agreement. Whether Tanmari could terminate the 2004 Agreement after the entry into the FIPL Purchase Agreement 189Next, the Plaintiffs contend that Tanmari was not entitled to terminate the 2004 Agreement where it had assigned the benefit of that agreement to FIPL under the FIPL Purchase Agreement. The Plaintiffs contend that FIPL as the assignee of the contractual right under a legal assignment is entitled, as owner of that right, to take action in respect of it. In Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd [2006] FCAFC 40; (2006) 149 FCR 395 at [30], [32], [42], Finn and Sundberg JJ observed that, where the benefit of contractual rights was assigned, the assignee also acquired the remedies in respect of non-performance including the right to terminate the contract. The Plaintiffs point out that Mr Cummings and Tanmari gave (or, as they put it, purported to give) notice of the assignment by letter dated 21 December 2011 (Ex P2 351) and, if that notice was effective, the assignment was effective under s 12 of the Conveyancing Act 1919 (NSW) from that date. 190The Defendants submit that the 2004 Agreement was not assigned to FIPL but was held on trust for it, because the 2004 Agreement required HSFS's consent before that agreement was assigned, and cl 5.4 of the FIPL Purchase Agreement provided that the parties would use all reasonable endeavours to obtain consent necessary to transfer Tanmari's rights under the relevant contracts including that agreement. While Tanmari and FIPL could have proceeded in that manner, they did not do so, possibly because (as I will note below) Mr Cummings understood the 2004 Agreement had terminated and FIPL did not have notice of the terms of that agreement or any contrary position taken by the Plaintiffs until after the FIPL Purchase Agreement had been executed and any assignment effected. The Plaintiffs also submit, and I accept, that an assignment without consent can still take effect, although it would involve a breach of the 2004 agreement: J Carter, E Peden & G Tolhurst, Contract Law in Australia, (5th ed 2007, LexisNexis Butterworths) at [17.24]. Clause 13.2 of the 2004 Agreement does not seem to me, on its proper construction, to amount to a condition to an effective assignment so as to invalidate an assignment undertaken in breach of it, since it neither provides that such consent is a precondition to a valid assignment nor provides that the absence of such consent invalidates an assignment. 191The Plaintiffs submit that, after Tanmari entered into the FIPL Purchase Agreement on 31 October 2011, only FIPL had the right to terminate the 2004 Agreement, and FIPL has not given notice to terminate that agreement. I also accept that submission, which follows from the matters set out above. 192Tanmari gave a further notice of termination of the 2004 Agreement by letter dated 23 May 2014 from Sparke Helmore to HSFS (Ex P2 401.) The Plaintiffs also contend that notice was ineffective. That notice was not necessary so far as any question of service was concerned, since I have held that the initial termination letter was effectively served, and does not otherwise bring about an effective termination of the 2004 Agreement where notice was given by Tanmari rather than FIPL. 193For these reasons, the 2004 Agreement has not been validly terminated. Right to updates (Amended Statement of Claim [40] - [46]) (Plaintiffs' issue 20) 194The next issue raised by the Plaintiffs is whether Tanmari is required to provide updates to HSFS under the terms of the 2004 Agreement, including updates so that QSS is compatible to the most recent version of IntelliCAD and whether FIPL is now responsible for providing the updates. The Defendants rely on cll 2.3(c) and 2.4 of the 2004 Agreement, which provide that Tanmari was obliged to provide new releases of the version of QSS that were compatible with the operating platform for IntelliCad version 4 but not thereafter, unless agreed in writing. I have set out those clauses above. 195The Plaintiffs point out that cl 2.3(c) of the 2004 Agreement provides that Tanmari warrants that QSS is and all new releases and updates "will be compatible with IntelliCAD 4, or such future version of IntelliCAD or such other operating platform as the parties may agree in writing." I read the words "may agree in writing" in cl 2.3(c) as qualifying both the words "such future version of IntelliCAD" and "such other operating platform" in this clause. The comma that appears prior to the words "or such further version" supports that reading of those words as quantifying both concepts. The reference to "such" prior to the reference to "future version of IntelliCAD" is also only consistent with a reading of that requirement as to extending to particular versions of IntelliCAD that were the subject of agreement. That reading of the clause is commercially reasonable, where Tanmari would be unlikely to accept an open-ended commitment to maintain compatibility with IntelliCAD without knowing what changes might in future be made to IntelliCAD or whether it would be technically possible to do so, at all or at a reasonable cost. It is common ground that there was no agreement in writing concerning compatibility with later versions and Mr Taylor's evidence is that there is no working version of QSS compatible with IntelliCAD 7 or version 7.2 (Taylor 30.5.14 [6], [8]-[11]). 196The Plaintiffs submit the parties only have to agree in writing if another operating platform is used, and not for IntelliCAD version 4 or for a future version of IntelliCAD. The Plaintiffs also submit that: " It is reasonable that the parties would need to agree in writing if Tanmari or [HSFS] were changing operating platforms as this would be a significant logistical and business issue if the parties changed platforms. In contrast, there were no significant issues if IntelliCAD transitioned from version 4 to a later version. The analogy is moving from Microsoft Windows to Apple requiring written agreement, but moving from Microsoft Windows version 7.0 to Microsoft Windows version 7.1 does not require written agreement." It does not seem to me that the terms of the clause support that construction of the clause, as I have noted above. It also seems to me that the Plaintiffs' analogy demonstrates the difficulty with their construction of this clause. Moving from one version of IntelliCAD to another or one version of Microsoft Windows to another may or may not raise significant difficulties, depending upon the differences between those versions, and there was good reason for the parties to require agreement to that course since either might be disadvantaged by a requirement for compatibility with a version of IntelliCAD that was significantly different to version 4. 197This reading of cl 2.3(c) of the 2004 Agreement has the result that Tanmari is not obliged to bring an update into existence, where it has not otherwise done so, so as to secure compatibility with later versions of IntelliCAD beyond version 4 unless that later version is agreed in writing between Tanmari and HSFS. However, cl 2.4 of the 2004 Agreement requires Tanmari to offer Updates and New Releases (as defined) to HSFS immediately as they become available, without further charge. I should note, for completeness, that Tanmari is not under any obligation to provide such updates to JRC, since it is not party to the 2002 Agreement and that agreement was abandoned no later than the date of HSFS's entry into the 2004 Agreement. Tanmari is also under no obligation to provide such updates to SFSI, both for that reason and because I have not accepted Mr Pacione's evidence that JRC sub-licensed its rights to SFSI as he claimed in April 2009. 198The parties led conflicting evidence as to the versions of QSS that were in fact available to HSFS, as to which they made somewhat limited submissions. On the one hand, the Plaintiffs submitted that updates were available and provided to licensees of Tanmari but not provided to HSFS, and in particular updates compatible to IntellliCAD 6 were not made available to HSFS. That submission was undermined by Mr Cummings' evidence in cross-examination, which I accept, that he did not provide updates to existing customers to IntelliCAD version 6, because the software was already compatible with IntelliCAD version 6, although new customers received versions of QSS that were combined with IntelliCAD version 6.6 which involved the provision of new software rather than an "update" or new release in respect of existing software (T297-298). It does not seem to me that that evidence is "elusive" (as the Plaintiffs described it in submissions) and there is nothing illogical about the sale of new software in one form without the provision of updates to existing customers, absent a contractual obligation to issue such updates. The obligation in the 2004 Agreement was, as the Plaintiffs recognise, to provide such updates to HSFS if they were made available, and does not arise where such updates (as distinct from new software in a different form) were not made available. 199The Plaintiffs also submitted that the current version of QSS is version 11.803 (Taylor 30.5.14 [8], [9]) and submitted that this has not been provided to HSFS. That submission has the difficulty that it assumes, without establishing, that that version of QSS is properly characterised as an "Update" or "New Release' for the purposes of the 2004 Agreement, notwithstanding Mr Cummings' evidence to which I have referred above. The Defendants respond that Tanmari provided updates and new releases to HSFS up to 11 August 2011 pursuant to the 2004 Agreement and thereafter by making them available to all of its customers, including HSFS, on its website. The Defendants also point out (in their submissions as to HSFS's allegation of conspiracy) that Mr Pacione accepted in cross-examination that the latest version of QSS held by HSFS, obtained in 2011, was version 11.599 or 11.604 (T178) and they submit that both those versions are compatible with IntelliCAD version 6.6 and no existing version of QSS is compatible with IntelliCAD version 7.2 (Taylor 30.05.14 [9] and [11]). They also point out that, in 2011 and 2013, SFSI made representations on its website that it could renew QSS licences for versions later than 11.603 (Cummings 14.10.13, Annexure RC2, pp.1, 3, 4 and Annexure RC3). It does not seem to me that the manner in which the Plaintiffs have put their case as to this matter allows me to conclude that any particular version of QSS which they say they do not have was an "Update" or "New Release" as defined in the 2004 Agreement, or that that particular update was made available to third parties and not to HSFS. It might be added that, although quantification is not in issue at this stage, any loss suffered by HSFS by this matter would be limited by the fact that it ceased to license new customers in April 2009 and did not purport to, and does not contend that it was entitled to, sub-license the software provided to it to SFSI. 200The Plaintiffs also submit that the FIPL Purchase Agreement restricts Tanmari's ability to provide updates to HSFS since, on the settlement date, Mr Cummings and Tanmari delivered all copies of the source code to FIPL (FIPL Purchase Agreement, cl 4.2(a)(i), Ex P2 330) and cl 4.2(b) of that agreement provides that Mr Cummings and Tanmari must not directly or indirectly make use of any of the Assets (as defined to include the QSS Application) except as directed by FIPL and Mr Cummings and Tanmari cannot be involved in the development, support, maintenance, licensing or sale of any software competing with QSS for the restraint period under cl 7.1 of the FIPL Purchase Agreement. The Plaintiffs also point out that cl 2.2 of the FIPL Purchase Agreement provides that FIPL will assume and perform all obligations of Mr Cummings and Tanmari in respect of the Specified Liabilities (as defined), which include the 2004 Agreement. These provisions do not prevent Tanmari complying with any such obligations under the 2004 Agreement with FIPL's consent or FIPL, as the successor to the copyright in QSS, doing so. 201The Plaintiffs alternatively, and somewhat tentatively, submit that emails from Mr Cummings to HSFS which refer to Tanmari transitioning to IntelliCAD version 7.2 "may constitute" an agreement for that purpose (Ex P2 193, 304, 308; Pacione 26.10.12 [88], Ex P7, 3/339; Liu 22.10.13 [24]; Ex P7, 5/tab 4, Annex "A" at 13, "Y" at 42, "BB" at 46). I do not accept that submission since discussion of that matter is not agreement about it. Right to escrow and implied term right to source code (Amended Statement of Claim [53]-[66]) (Plaintiffs' issues 21-23) 202The next issues identified by the Plaintiffs are whether Tanmari breached an obligation to deposit source code with an escrow agent; whether, if Tanmari breached its obligation to deposit source code, there was an implied term in the 2004 Agreement that if Tanmari breaches that obligation then it is required to provide source code if one of the escrow release conditions is satisfied; and whether, if there is such an implied term, one of the escrow release conditions been satisfied. 203Mr Pacione's evidence is that he raised the question of placing the source code in escrow with Mr Cummings in March 2005 (Pacione 26.10.12 [52]). Mr Cummings conceded in his evidence that the issue of putting the source code in escrow was raised by Mr Pacione at various times after the 2004 Agreement was entered, and he attributes the words "don't worry, we'll get around to it" to Mr Pacione (Cummings 4.12.12 [107]). Mr Pacione denied that conversation in evidence in reply (Pacione 28.1.13 [52]). 204Mr Pacione contacted an escrow agent in mid-2007 (Pacione 26.10.12 [59]) and, in November 2007, obtained a verification report from the proposed escrow arrangement as to source code provided to JRC at the time of entry into the 2002 Agreement (Pacione 26.10.12 [60], Ex P7, 3/250). Communications took place between the proposed escrow agent and Mr Cummings in early 2008. By email dated 9 January 2008, the proposed escrow agent referred to issues that had been identified during the verification of the QSS software (implicitly, in respect of the 2002 Agreement) and noted that it had also been requested to look at the QSS/HSFS material subject to a second licence agreement, presumably the 2004 Agreement. That email noted that: "The key objective of the review that we recently undertook is to ensure that the source code, as lodged/provided, is current and provides the necessary basis for a build should a probably unlikely event be triggered that would make this necessary." (Ex P7, 3/289) The proposed escrow agent suggested that it would like to address issues relating to: "The current versioning, build and other documentation, and some suggestions on our part as to how to restructure the source code material currently held to better reflect the actual position." (Ex P7, 3/289) Mr Cummings appears to have taken no objection to that approach. However, it should be recognised that Tanmari's obligation in respect of the lodgement of source code was to lodge that source code in the form it existed, not to engage in any process of improving it. The further suggestion made by the escrow agent seems to me to be inconsistent with an obligation to lodge the source code as it existed at a particular point in time in escrow, as distinct from improving it for other purposes. No doubt, parties could contract for source code to be revised or improved to meet particular objectives, but the parties in this matter had not done so. 205Mr Pacione renewed his request for the source code to be placed in escrow in November 2008 (Pacione 26.10.12 [68], Ex P7, 3/294). Mr Cummings' evidence is that he received a draft escrow agreement from Mr Pacione in January or February 2009, although he did not keep a copy of it, and that the release provisions in respect of the source code did not reflect the terms included in the 2004 Agreement. His evidence is that, after receiving the draft, he called Mr Pacione and said words to the effect that: "I've been to see my accountant. He's told me that the software's an asset and I shouldn't be prevented from transferring it. I am concerned about the triggering events. I can't agree to your draft." (Cummings 4.12.12 [114]) Mr Pacione denies that conversation (Pacione 28.1.13 [56]). It seems to me likely that the draft would have contained such provisions, so far as other drafts in evidence were to similar effect. Mr Cummings' evidence is consistent with his practice of discussing matters of this kind with his accountant rather than with a solicitor throughout the relevant period. I prefer Mr Cummings' evidence to Mr Pacione's evidence in respect of this conversation. Mr Cummings' evidence in cross-examination was that there was a particular clause in the draft escrow agreement that he was not happy with and he did not accept that draft agreement and he was not asked to identify that clause (T293). 206A further meeting took place between Mr Cummings and the proposed escrow agent in January 2009 (Pacione 26.10.12 [69]). Mr Pacione then sent Mr Cummings a further draft escrow agreement in March 2009 (Pacione 26.10.12 [71], Ex P7, 3/322; Cummings 4.12.12 [116]). That draft software escrow agreement was prepared by the solicitors acting for Mr Pacione and referred to the parties as JRC, Tanmari, Mr Cummings and the proposed escrow agent, and to that extent was not consistent with the fact that the 2004 Agreement was with HSFS, not JRC. Mr Pacione claimed that the reference to JRC in the draft escrow agreement circulated in 2008 was a "mistake" and that should have been a reference to HSFS. It was put to Mr Pacione, although he denied, that the draft agreement was sent in JRC's name in order to advance a restructuring so that licence fees would no longer be paid to Tanmari under the 2004 Agreement (T103). I consider it unlikely that the preparation of a draft escrow agreement that named JRC rather than HSFS was merely a mistake, and it seems to me that draft was intended to put JRC in the position that it would have obtained the software had the escrow conditions be satisfied. 207The escrow events included in that draft agreement were also not consistent with those provided in the 2004 Agreement because the suggested agreement was extended beyond the source code to "Material" (which was defined to include a significant volume of information); extended to provide for the release of the source code and the "Material" in the event, not only of actual or threatened insolvency on the part of Mr Tanmari and Mr Cummings, but if Mr Cummings or Tanmari were "in jeopardy of becoming subject to any form of insolvency administration"; and an additional event for the release of the source code and "Material" was introduced, namely, if Mr Cummings assigned or transferred any of his right and interest in the Software and Improvements to any other person. It seems to me that Mr Cummings was justified in not entering into that agreement in the form proffered by HSFS, whether or not he had recognised the extent to which it sought to improve the position of the interests associated with Mr Pacione beyond that contemplated by the 2004 Agreement. 208By an email dated 8 March 2009, Mr Pacione retreated somewhat from that position that had previously been advanced in that draft escrow agreement, advising by email that he had cut out matters that were not mentioned in "our licence", which was presumably a reference to the 2004 Agreement. The email refers to an attachment, a further revised draft escrow agreement, but that attachment is not in evidence and whether it was in fact in terms consistent with the 2004 Agreement has not been established. A further email from the proposed escrow agent dated 19 March 2009 referred to Mr Cummings' advice that he had "significant problems with the triggering events" (Ex P2, 187) although it is not clear to which draft of the agreement he was referring, and whether those concerns were justified cannot be assessed without access to the terms of the relevant draft. By email dated 19 April 2009, Mr Pacione again referred to the escrow agreement, which was said to be straight out of "an existing agreement" (Ex P2, 190). 209A further discussion took place in late March 2009 between Mr Cummings and the proposed escrow agent in respect of the trigger events for a release of the source code from escrow (Pacione 26.10.12 [72]; Ex P7, 3/323; Cummings 4.12.12 [113]-[114]) and further communications between Mr Pacione and Mr Cummings followed. An agenda prepared by Mr Pacione for a meeting on 3 April 2009 referred to the proposed escrow agreement (Pacione 26.10.12 [81], Ex P7, 3/332; Cummings 4.12.12 [121]-[122]). A meeting then took place between Mr Pacione and Mr Cummings at Sydney Airport on 6 April 2009. Mr Pacione's evidence of that meeting (Pacione 26.10.12 [79]-[81]) is that he said to Mr Cummings that: "The corporate issues such as assigning our rights and escrow are well overdue." (Pacione 26.10.12 [84]) Mr Cummings' evidence is that he does not have a recollection of the meeting (Cummings 4.12.12 [123]) although he denies Mr Pacione's evidence that he walked out on that meeting. I accept that it is, on its face, surprising that Mr Cummings does not have a recollection of that meeting, in circumstances that he has been able to give evidence of other conversations with Mr Pacione in the relevant period. 210The question of the escrow agreement and a suggested assignment of the 2004 Agreement was again canvassed in an email from Mr Pacione to Mr Cummings dated 19 April 2009 (Pacione 26.10.12 [84], Ex P7, 3/333). 211A letter dated 18 November 2011 from the solicitors acting for the Plaintiffs to Mr Cummings referred both to the 2002 and 2004 Agreements; identified suggested deficiencies with the "source code which was provided to our client" in respect of the 2002 Agreement and also referred to an obligation of Tanmari to deposit the source code for the QSS with an escrow agent on terms acceptable to HSFS. The latter statement was something of a gloss on the 2004 Agreement, which referred to an obligation to enter an escrow agreement with a reputable escrow agent, with the deposit of the source code being a matter that would presumably be addressed by that escrow agreement. 212A further letter dated 6 January 2012 from the solicitors acting for Mr Pacione and the companies associated with him responded to various matters raised in the letter dated 21 December 2011 from the solicitors acting for Mr Cummings and Tanmari, maintained JRC's entitlement to source code under the 2002 Agreement, and went so far as to allege that the source code provided by Mr Cummings in respect of the 2002 Agreement have been "falsely marked to be the source code". That allegation is not now pressed by the Plaintiffs. 213The Plaintiffs submit that Tanmari was and is required to put the source code for QSS in escrow, to be released on certain specified conditions. They point out that cl 5 of the 2004 Agreement (Ex P7, 3/211) requires the parties to enter into an escrow agreement, with an escrow agent, in relation to QSS, to be released in the circumstances set out in that agreement. They submit, and it is common ground, that Tanmari did not enter into an escrow agreement, and did not deposit the then source code to QSS in escrow. It should, however, be noted that HSFS also failed to comply with cl 5 of the 2004 Agreement, so far as the only draft escrow agreement proffered by it that is in evidence did not comply with the requirements of that clause. 214The Defendants respond (in their submissions as to HSFS's allegation of conspiracy) to the Plaintiffs' criticisms of Mr Cummings' failure to deposit source code into escrow. They submit that the evidence establishes that Mr Cummings was initially negotiating a suitable agreement with Mr Pacione, through a representative of the escrow agent. They note that the draft escrow agreement provided (as I noted above) for JRC to be a party to it, whereas HSFS was party to the 2004 Agreement which gave rise to the provision of source code into escrow (Pacione 26.10.12, Ex P7, 3/299-321; Cummings 4.12.12 [118]-122], [127]-[130], [134]-[135]; T286). That difference seems to me to be material since an escrow agreement in favour of JRC had the potential, if the conditions to release of the software were satisfied, to allow JRC to take possession of the software to which (as I have held above) it had limited rights under the 2002 Agreement and no rights under the 2004 Agreement. The Defendants also submit that Mr Cummings did not ultimately finalise these negotiations because he was not being paid licence fees, and he suspected that Mr Pacione was selling QSS to new customers without paying him those licence fees (Cummings 4.12.12, [118]-[122], [127]-[130], [134]-[135]; T286). That suspicion was correct, so far as sales were made by SFSI at least from April 2009, although it does not provide a contractual justification for non-compliance with the requirements as to entry into the escrow agreement under the 2004 Agreement. 215The Defendants also plead that Tanmari did not enter into the escrow agreement because the proposed escrow agent was not independent (Defence [54(b)(iii)]). I do not understand that submission to have been pressed and it does not seem to me to have been established by the evidence of some dealings between that escrow agent and HSFS in respect of verification of the QSS source code, and is also not supported by Mr Cummings' evidence as to the matters that concerned him at the relevant time. 216The Plaintiffs submit that the release conditions in the draft escrow agreement (Pacione 26.10.13, Ex P7, 3/307) "substantially" reflect the release conditions in the 2004 Agreement (cl 5, 2004 Agreement, Pacione 20.10.13, Ex P7, 3/211). The Plaintiffs also submit that: "... it is disingenuous for Tanmari to claim that the draft Escrow Agreement did not reflect the [2004] Agreement in circumstances where [Mr Cummings] was given the opportunity to comment on the draft escrow agreement, and [Mr Cummings] did not make comments or seek amendments to the draft escrow agreement". I do not accept that submission. HSFS and Mr Pacione proffered a draft escrow agreement that significantly expanded HSFS's rights beyond those to which it was entitled under the 2004 Agreement, leaving Mr Cummings, who they would have known typically did not take legal advice to such matters, to identify the differences if he could. It seems to me that Mr Cummings and JRC had every reason to object to that approach. Nonetheless, the Plaintiffs have established that Tanmari breached the 2004 Agreement, so far as it was obliged to enter into an escrow agreement and did not do so. 217The Plaintiffs submit that Tanmari is now required to enter into the escrow agreement and put the source code for QSS in escrow, to be released on the conditions set out in cl 5 of the 2004 Agreement. I do not accept that submission, which is in the nature of an application for a mandatory injunction but is not supported by any submission as to why such an order is an appropriate remedy in the circumstances. It seems to me that damages are an appropriate remedy for the breach of Tanmari's obligation to enter into that escrow agreement, and the quantification of those damages may well reflect the extent to which HSFS's conduct contributed to any resulting loss and the fact that HSFS substantially ceased to grant new licences in April 2009. I would also decline injunctive relief as a matter of discretion, where HSFS's actions in proffering a draft escrow agreement that did not comply with the 2004 Agreement plainly contributed to the breach by Tanmari; the deposit of the source code as it exists in 2014 would be materially different from the deposit of the source code as it existed in 2004; and HSFS has not in any event since April 2009 been conducting business in respect of new customers. 218The Plaintiffs also submit that, if Tanmari failed to enter into an escrow agreement and failed to deposit the QSS source code with a reputable escrow agent within a reasonable period, then there is an implied term in the 2004 Agreement that Tanmari will be obliged to provide the QSS source code direct to HSFS if any of the conditions in cl 5 of the 2004 Agreement are satisfied. It does not seem to me that that suggested term complies with the requirements for implication of a term as a matter of fact as stated in BP Refinery (Westenport) above. The Plaintiffs submit that it is necessary for business efficacy that HSFS have some mechanism to have access to the source code for QSS if the events listed in cl 5 of the 2004 Agreement eventuate, but it had such a mechanism so far as it could at any time have sought an order requiring Tanmari to comply with the clause, at least if it had itself proffered a compliant escrow agreement for execution by Tanmari. The Plaintiffs also submit that it is reasonable and equitable between the parties that HSFS have some mechanism to have access to the QSS source code if Tanmari fails to provide services or is otherwise unable to provide a level of development, design and software engineering assistance or services in relation to QSS to meet HSFS' ongoing business requirements. In my view, the suggested implied term is not necessary to give business efficacy to the contract, where the Court could order compliance with cl 5 of the 2004 Agreement in an appropriate case or alternatively award damages for the breach. The suggested clause is also by no means so obvious that it goes without saying, where it parallels the orders that might be made by the Court but excludes the discretionary factors that the Court will take into account as to whether such an order should be made. 219I also do not accept that, in any event, the conditions in the 2004 Agreement are satisfied so as to trigger any obligation to provide source code The Plaintiffs submit that the conditions in cl 5 of the 2004 Agreement have been satisfied, because Mr Cummings is incapacitated from providing services due to cll 4.1, 4.2 and 7 of the FIPL Purchase Agreement providing for the sale of QSS to FIPL. I do not accept that submission. In oral opening submissions, the Plaintiffs also sought to read the reference to "incapacity" in the 2004 Agreement, which refers to Mr Cummings rather than to Tanmari, as triggered where Mr Cummings or Tanmari entered into the agreement with FIPL in 2011, so (it was suggested) that they are thereafter legally incapacitated from providing the relevant services to HSFS. It seems to me that a contractual prohibition on Mr Cummings or Tanmari providing source code under the Purchase Agreement with FIPL does not "incapacitate" him or Tanmari from taking that step, so far as he would presently be able to take that step with FIPL's consent. Even if the proposition for which the Plaintiffs contend were made good, it would not follow that HSFS is then entitled to the source code as it existed in 2011 or as it exists in 2014. It would instead be entitled to damages reflecting the loss that it suffered by reason of a failure to enter into an escrow agreement at an earlier point in time, or, at best, an order requiring provision of the source code as it existed at the time of entry into the 2004 Agreement. Development services, information and assistance (Amended Statement of Claim [47]-[52]) (Plaintiffs' issues 25-27) 220The next issues identified by the Plaintiffs are whether HSFS had requested Tanmari to provide development services which it was required to provide; whether Tanmari failed to provide those development services; and whether Tanmari breached its obligation to provide information and assistance. 221In the period from July 2009, Mr Liu, who was working with SFSI, requested assistance from Mr Cummings in respect of various matters. By about this time, Mr Cummings was becoming uncooperative in respect of such assistance, as he accepted in cross-examination. By at least September 2009, I think it likely that he had formed a suspicion that interests associated by Mr Pacione were granting licences without making payments to Mr Cummings or Tanmari, as was in fact the case. Version 11.561 of QSS, as at about that date, introduced a new feature by which new users automatically sent an email to Mr Cummings. Mr Cummings' evidence is that he inserted the email notification feature into QSS in about September 2009, because of a concern about privacy of QSS, particularly in Malaysia, although he also acknowledges that he became suspicious that HSFS was entering into new agreements with customers but not passing on licence fees by late September 2009 (Cummings 4.12.12 [133]-[134]). Mr Liu protested the introduction of that feature, ostensibly on the basis that customers had not consented to it. While that proposition was true, it seems to me that an inference that SFSI's real objection to that feature was that it would identify new users, for which it had not paid any amount to Mr Cummings or Tanmari, would at least be open, although it is not necessary to draw it in order to determine this case. 222The Plaintiffs point out that cl 4.1 of the 2004 Agreement provides that HSFS can at any time and on reasonable notice request Tanmari to provide development services relating to the QSS software, and the parties will enter into a development agreement. HSFS and Tanmari entered into two written development agreements, being Software Development Agreements dated 11 August 2004 (Ex P2 127, Pacione 26.10.12, Ex P7, 3/221) and 30 May 2005 (Ex P2 140, Pacione 26.10.12, Ex P7, 3/233). The Plaintiffs submit that, from around 2009, Tanmari refused to provide development services (Pacione 26.10.12 [78]-[89]; Liu 22.10.12 [12]-[13], [15], [19]; Pacione 19.3.14 [152]-[162]). The Plaintiffs refer to one email where Mr Liu indicated a willingness to pay for the relevant service and asked for an estimate of time and costs (Liu 22.10.13, Ex P7, 5/tab 4, Annexure "LL" at 53). The Plaintiffs also submit that Tanmari's refusal to provide development services is a breach of the 2004 Agreement and caused loss, contending that HSFS was compelled to engage a third party, Andamac Development, on an hourly rate to undertake development work (McLauchlan 26.10.12, McLauchlan 3.3.14 [31] - [33], Pacione 19.3.14 [154] - [161], Liu 22.10.12 [23].) The Defendants submit (in their submissions as to HSFS's allegation of conspiracy) that the evidence showed that Mr Cummings in fact continued to provide assistance to what he believed was HSFS after April 2009 although that assistance was not extended to services in respect of customers for which he was not paid licence fees (Cummings T286, T295; Liu 22.10.12, Annexures B (27 July 2009), C (29 July 2009) and F (11 and 13 September 2009); Pacione 26.10.12, Ex P7, 3/334 (24 April 2009), 339 (4 November 2010)). 223It does not seem to me that a breach of cl 4.1 of the 2004 Agreement was established where HSFS did not in fact proffer further development agreements for execution or send purchase orders, as Mr Cummings at one point suggested as an alternative. That clause is not directed to the provision of ad-hoc services in response to email requests, but to a more formal arrangement for such services documented by such agreements. Moreover, since at least April 2009, any requests for development services were not in truth made by HSFS, because it had substantially ceased business, but by SFSI to which Tanmari had no obligation to provide development services. 224The Plaintiffs also submit that, under cl 3 of the 2004 Agreement, Tanmari was and is required to provide information and assistance when reasonably requested by HSFS, including assistance and staff training, and copies of all information, documentation and other tools or materials relating to QSS reasonably necessary to enable HSFS to use, copy, market, resell and promote QSS. The Plaintiffs submit that Tanmari failed to provide assistance in that it did not explain information and methodology (Pacione 26.10.12 [82], [85], [87], [89]; Pacione 28.1.13 [71]-[73]); took the position that there were "no notes" (Pacione 26.10.12 [82]), and from time to time refused assistance (Liu 22.10.13 [19], [24]). 225In order to establish a breach of this clause, HSFS would have had to establish that the particular information and assistance was reasonably requested in the circumstances and that it was reasonably necessary to enable HSFS to use, copy, market, resell and promote QSS. As I noted above, from April 2009, HSFS had ceased to grant licences to new customers and SFSI, which had no such right to information and assistance, was doing so in its place. The evidence led by HSFS showed that the requests were made but not that they were reasonable in the circumstances or that the information and assistance was reasonably necessary for the relevant purpose. It is difficult to see that any such information or assistance, after April 2009, could have been reasonably requested or was reasonably necessary for that purpose where SFSI rather than HSFS was dealing with new clients and licence fees were no longer being paid to Tanmari in respect of such clients. A breach of this requirement has not been established. Confidential Information (Amended Statement of Claim [67]-[70]) (Plaintiffs' issues 28-29) 226The next issues identified by the Plaintiffs are whether HSFS provided Tanmari with confidential information and whether Tanmari used or disclosed the confidential information in breach of the 2004 Agreement. 227The Plaintiffs point out that cl 9 of the 2004 Agreement requires Tanmari to keep and maintain all of HSFS's confidential information strictly confidential; only use it for the purposes for which it was disclosed; and not disclose other than to employees, sub-contractors, legal advisers, auditors and other consultants who require the information for the purposes of that agreement. 228The Plaintiffs identify information of three kinds that they contend was provided to Mr Cummings and Tanmari and is confidential to HSFS. First, they contend that they (or at least HSFS) provided Mr Cummings with encryption software that was confidential. It appears that Mr Cummings did not draft that encryption software since, by an email dated 18 February 2008 to HSFS, he referred to "your" encryption software and made various criticisms of it (Pacione 26.10.12, Ex P7, 3/292). Mr McLauchlan's evidence is that his company, Andamac Development, created that software and that Mr Cummings then made changes to the source code for QSS so that it could run that software (McLauchlan 3.3.14 [49]-[52]). Second, the Plaintiffs contend that a T-cord truss and U-chord truss were products supplied by HSFS (Pacione 26.10.12 [78] and Ex P7, 3/328; Roulant 8.5.14 [63], T223-224; Pacione 19.3.14 [75(c)], [146]; Pacione 28.1.13 [60]). It does not, however, follow that they were confidential where their shape and dimensions were presumably available to numerous users of the products. Third, they submit that CNC files were HSFS's confidential information, even if they were created by Tanmari, because a CNC file incorporates "[HSFS] and its customers' confidential information". 229The Plaintiffs point out that cl 7.3 of Software Development Agreements dated 11 August 2004 (Ex P2 127, Pacione 26.10.12, Ex P7, 3/221-231; Ex P2 140, Pacione 26.10.12, P7, 3/233) provide that exclusive ownership of all data files and CNC files comprising HSFS's data incorporated into the New Software shall be and remain vested in HSFS (although that leaves open the question of which data had that character) and cl 10.1 of those agreements required Tanmari to hold and maintain all "Confidential Information" in strict confidence and as a trade secret of HSFS and not to use the "Confidential Information" in whole or in part other than in accordance with the agreement. The term "Confidential Information" was in turn broadly defined in those development agreements as including, inter alia, information relating to the design, specification and content of data files and CNC files comprising HSFS data incorporated into the software. 230The Plaintiffs point out that, under cll 2.1 and 4.2 of the FIPL Purchase Agreement, Mr Cummings and Tanmari sold and transferred the Assets (as defined) and delivered possession and control of those Assets to FIPL. The term "Assets" includes Software, Business Records, and any other assets and information; the term "Business Records" includes "Documentation", and the term "Documentation" includes all documentation relating to the software including all technical and marketing documentation and specifications. They submit that: "Therefore, [Mr Cummings] and Tanmari disclosed information in the QSS Application. This included [HSFS] encryption software, T-Cord Truss, U-chord Truss and CNC files." 231I do not accept the last step of this submission. The Plaintiffs point to the categories of information that Mr Cummings and Tanmari were obliged to deliver under the FIPL Purchase Agreement and assume that they included information delivered by HSFS to Mr Cummings or Tanmari at earlier points in time. That is certainly possible, but it is also possible that such information had been displaced by development work done by Tanmari between 2009 when the relationship with HSFS had substantially ceased - and, indeed, HSFS had substantially ceased its business - and its entry into the FIPL Purchase Agreement in 2011. It does not seem to me that this claim can be established by inference at this level of generality, as distinct from a comparison of the particular information claimed to be confidential with the information in fact provided by Mr Cummings and Tanmari to FIPL. The Plaintiffs did not seek to undertake a comparison of that character. It does not seem to me that this claim has been established. Obligation of good faith (Amended Statement of Claim [71]-[74]) (Plaintiffs' issues 30-31) 232The next issues identified by the Plaintiffs are whether Tanmari had an obligation of good faith under the 2004 Agreement and whether it breached such an obligation of good faith. 233The Plaintiffs point out that cl 13.2 of the 2004 Agreement provided that neither party may assign or transfer its rights in the 2004 Agreement or QSS without first obtaining the other party's written consent, and the other party will not unreasonably withhold such consent; and cl 13.4 of the 2004 Agreement required that each party do anything (including executing any document) and ensure that its employees and agents do anything (including executing any document) that the other party may reasonably require to give full effect to the 2004 Agreement. They also submit there is an implied term in the 2004 Agreement that each party would act in good faith and reasonably towards the other in exercising or enforcing its rights. They refer in this regard to Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSLWR 234, although it should be noted that there are several subsequent decisions which deal with the extent to which such a duty should be implied and its content: see for example, Alcatel Australia Ltd v Scarcella (1998) 44 NSWLR 349 at 363-369 per Sheller JA (with whom Powell and Beazley JJA agreed); Burger King Corporation above at [186]; United Group Rail Services Ltd v Rail Corporation (NSW) [2009] NSWCA 177; (2009) 74 NSWLR 618 at [58]-[61] per Allsop P (with whom Ipp and Macfarlan JJA agreed). 234Some earlier cases had expressed the view that a duty of good faith was implied by law in all commercial contracts: see for example, Overlook v Foxtel [2002] NSWSC 17 at [62] per Barrett J (as his Honour then was); Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd [2005] FCA 288 at [64] per Finkelstein J. However, in Vodafone Pacific Ltd v Mobile Innovations Ltd [2004] NSWCA 15, Giles JA (with whom Sheller and Ipp JJA agreed) stated (at [191]): "I do not think the law has yet gone so far as to say that commercial contracts are a class of contracts carrying the implied terms [of a duty of good faith] as a legal incident, and the width and indeterminancy of the class of contracts would make it a large step." Several subsequent decisions have indicated that whether a duty of good faith will be implied into a contract will depend on the particular contract and the particular circumstances of the case: Council of the City of Sydney v Goldspar Australia Pty Ltd [2006] FCA 472; (2006) 230 ALR 437 at [168] per Gyles J; Insight Oceania Pty Ltd v Philips Electronics Australia Ltd [2008] NSWSC 710 at [157]-[175] per Bergin J; see also R McDougall, "The Implied Duty of Good Faith in Australian Contract Law" (2006) 108 Australian Construction Law Newsletter 28; J Allsop, "Good faith and Australian contract law: A practical issue and a question of theory and principle" (2011) 85 Australian Law Journal 341; B Hoffmann and R Dias, "20 years on from Renard Constructions - is the contractual duty of good faith any clearer?" (2012) 24 Australian Construction Law Bulletin 23. 235In Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184, Bathurst CJ (with whom Macfarlan and Meagher JJA agreed) stated (at [145]) that the content of such a duty: "... has commonly been held to embrace three related matters: 1. An obligation on the parties to co-operate to achieve the contractual objectives. 2. Compliance with honest standards of conduct. 3. Compliance with standards of conduct that are reasonable having regard to the interests of the parties." (citations omitted) Bathurst CJ also expressed the view (at [144]) that: "the obligation does not require a party to act in the interests of the other party or subordinate its own legitimate interests to those of the other party, although it does require it to have due regard to the rights and interests of the other party." A contractual duty of good faith cannot, however, impose obligations on parties that are inconsistent with the terms of the relevant agreement: Cordon Investments above at [146]; Vodafone above at [194], [208]. 236In Tresedar Pty Ltd v Property Builders (Constructions) Pty Ltd (in liq) [2014] NSWSC 382 at [160]-[161], Ball J helpfully summarised the position as follows: "The circumstances in which a court will imply a term requiring each to act in good faith remains uncertain: see Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184 at [144] per Bathurst CJ. For discussion see, K Lewison & D Hughes, The Interpretation of Contracts in Australia, (2012, Law Book Company) at [6.14]. There is authority that the terms should be implied in all commercial contracts: see, for example, Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 at 268 per Priestley JA. Other cases have suggested that the term should only be implied as a matter of fact in accordance with the principles stated in the BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266: see eg Androvitsaneas v Members First Broker Network Pty Ltd [2013] VSCA 212 at [108]; R & J Lyons Family Settlement Pty Ltd v 155 Macquarie St Pty Ltd [2008] NSWSC 310; (2008) 13 BPR 25,161 at [68] per Bryson AJ; Tote Tasmania Pty Ltd v Garrott [2008] TASSC 86; (2008) 17 Tas R 320 at [16]; Esso Australia Resources Pty Ltd v Southern Pacific Petroleum NL [2005] VSCA 228 at [25] per Buchanan JA; Australian Hotels Association (NSW) v TAB Ltd [2006] NSWSC 293 at [78] per Bergin J. In that case, the implication of the term depends on the presumed intention of the parties. One feature of the implied term is that it is expressed at such a level of generality and abstraction that it can be difficult to determine its content in any particular case. Consequently, to suggest, as some cases do, that the term should be implied as a matter of law in all commercial contracts has the effect of moving the enquiry from whether a particular term should be implied in the circumstances of the case to the question of the content of the general term in light of those circumstances." 237The Plaintiffs also submit, and I accept, that, each party has an obligation to co-operate to achieve contractual objectives, particularly where the contract requires or envisages co-operation and involves an ongoing business arrangement: RPR Maintenance Pty Ltd v Marmax Investments Pty Ltd [2014] FCA 409 at [208], [212]-[213] per Griffiths J. 238The Plaintiffs identify numerous matters that they contend involved a breach of Tanmari's express and implied obligations in this regard under the 2004 Agreement. First, they contend that Tanmari breached that obligation in respect of refusing to engage with Mr Pacione's (or HSFS's) request for consent to assign its rights under the 2004 Agreement. The relevant obligation was, under the terms of that agreement, not unreasonably to withhold consent to an assignment. It seems to me that, for the reasons noted in paragraph 177 above, Mr Cummings and Tanmari would have been reasonably entitled to withhold such consent in the relevant circumstances. 239Second, the Plaintiffs contend that Tanmari refused to engage and reasonably consider HSFS's requests relating to the escrow process in cl 5 of the 2004 Agreement. I have held above that a breach of the obligation to enter an escrow agreement is established, although that obligation attached to both HSFS and Tanmari and each of them breached it. It does not seem to me that a further breach of duties of good faith or cooperation or to execute a document reasonably required to give effect to the 2004 Agreement are established, where the process adopted by HSFS in respect of the escrow had, as I noted above, sought substantially to enlarge its rights beyond those contemplated by the 2004 Agreement. The Plaintiffs also rely, as a further matter supporting a breach of a duty of good faith in this regard, on the fact that Tanmari delivered all copies of the source code to FIPL under cl 4.2 of the FIPL Purchase Agreement, so that Tanmari was not able to deliver the source code to the escrow agent. It does not seem to me that that course was capable of breaching such a duty, where some seven years had lapsed from the execution of the 2004 Agreement without the entry into an escrow agreement, and where HSFS had ceased to grant new licences and SFSI had commenced to do so without payment of licence fees to Tanmari from April 2009. The Plaintiffs also contend that it was a breach of the 2004 Agreement for Tanmari to assign or transfer the QSS software without first obtaining HSFS's consent, under cl 13.2 of the 2004 Agreement. A breach of that provision may give rise to a claim for damages - if HSFS suffered any, where it had ceased to deal with new clients some time before - but does not seem to me to establish any independent breach of a duty of good faith that would not otherwise be established. 240Third, the Plaintiffs contend that Tanmari did not reasonably consider HSFS's requests for development services. The Plaintiffs also point out that cl 7.1 of the FIPL Purchase Agreement restricted Mr Cummings' and Tanmari's ability to provide development services. I have held above that the Plaintiffs have not established a breach of the express provision of the 2004 Agreement dealing with the provision of such services, and it does not seem to me that conduct that did not breach that provision can be recharacterised as a breach by Tanmari of a duty of good faith, particularly where HSFS had ceased to grant new licences and SFSI had commenced to do so without payment of licence fees to Tanmari from April 2009. 241Fourth, the Plaintiffs repeat a matter on which they previously relied to support the second suggested breach of the duty of good faith by pointing out that Tanmari did not seek HSFS's consent before assigning (or, as the Plaintiffs would have it, purporting to assign) its rights under the 2004 Agreement and in QSS to FIPL, as required by cl 13.2 of the 2004 Agreement. The Plaintiffs also observe, in a criticism that reads oddly given Mr Pacione's lack of transparency in respect of licences granted by SFSI after April 2009, that "Tanmari did not even disclose the deal to [HSFS]". As I have noted above, a breach of that provision may give rise to a claim for damages - if HSFS suffered any, where it had ceased to deal with new clients for April 2009 - but does not seem to me to establish any independent breach of a duty of good faith that would not otherwise be established. 242Fifth, the Plaintiffs contend that Tanmari's failure to engage in the dispute resolution procedure under cl 10 of the 2004 Agreement and its termination of the 2004 Agreement amounted to a breach of a duty of good faith. There is a dispute between the parties as to their dealings in respect of that mediation proposal, and the terms on which FIPL would have been prepared to engage in a mediation, but I do not consider it necessary to determine that dispute in order to address this claim. It does not seem to me that this submission adds anything to any breach of cl 10 of the 2004 Agreement that would otherwise be established, and I do not consider that a breach of the duty of good faith is established by it, again in the context that HSFS had ceased to grant new licences and SFSI had commenced to do so without payment of licence fees to Tanmari from April 2009. 243Sixth, the Plaintiffs contend that Tanmari breached a duty of good faith by not seeking a novation of the 2004 Agreement so that HSFS would have a direct contractual relationship with FIPL. The Plaintiffs do not point to any case law which has treated a failure by one contracting party to novate rather than assign a right under the contract to a third party as a breach of a duty of good faith, although the two forms of transaction would typically have different legal consequences, and the duty of good faith does not, even on the widest view, require one contracting party to subordinate its interests to the other's interests. This breach is also not established. 244Seventh, the Plaintiffs contend that Tanmari purported to terminate the 2004 Agreement for breaches of that agreement that, they contend, Tanmari had been aware of for more than two years. I do not accept the premise of this submission where Mr Pacione and HSFS had not, in fact, disclosed to Mr Cummings or Tanmari in any direct way that HSFS had ceased to grant new licences and SFSI had commenced to do so without payment of licence fees to Tanmari from April 2009. 245Next, the Plaintiffs contend that Tanmari did not provide HSFS with updates that were compatible with IntelliCAD version 6.6, even though the updates were available and it was required to make such updates immediately available under cl 2.4 of the 2004 Agreement, and it warranted that QSS would be compatible with IntelliCAD under cl 2.4(c) of the 2004 Agreement. This proposition merely recharacterises the suggested breach of cl 2.4 of the 2004 Agreement as a breach of a duty of good faith. That breach is not established for the same reasons that the breach of cl 2.4 of the 2004 Agreement is not established. 246Next, the Plaintiffs contend that Mr Cummings represented to a third party that he or Tanmari had a contract with HSFS and that HSFS had not purchased software since 2007, by an email dated 22 December 2011 (Ex P2 371, Pacione 19.3.14 JP4-M.) The Plaintiffs characterise this email as a representation that the 2004 Agreement did not exist and HSFS did not have any rights. It does not seem to me that the email contained a representation that the 2004 Agreement did not exist, where it expressly referred to a "contract" with HSFS. The proposition that HSFS had not "purchased software" since 2007 was not correct in respect of its date, although HSFS had not paid licence fees since at least April 2009. The error or overstatement in that email does not seem to amount to a breach of a contractual duty of good faith. 247For these reasons, the claim for a breach of a duty of good faith is not established. Plaintiffs' other claims 248The Plaintiffs also plead that Tanmari, Cummings and FIPL, as the case may be, have conspired to cause harm to HSFS (paragraphs 78-83 of the Amended Statement of Claim); have engaged in misleading or deceptive conduct in respect of representations made on a website and to customers and potential customers (paragraphs 84-96 of the Amended Statement of Claim); have engaged in unconscionable conduct (paragraphs 97-111 of the Statement of Claim); have committed the tort of inducing breach of contract, in respect of an allegation that Tanmari's entry into the FIPL Purchase Agreement breached the 2004 Agreement, and that FIPL induced or procured Tanmari to enter into the FIPL Purchase Agreement (paragraphs 112-116 of the Amended Statement of Claim) and in respect of the purported termination of the 2004 Agreement (paragraphs 117-120 of the Amended Statement of Claim) and have made groundless threats of copyright infringement (paragraphs 122-125 of the Amended Statement of Claim). Tort of conspiracy (Amended Statement of Claim [78]-[83]) (Plaintiffs' issues 32-35 (where first occurring)) 249The Plaintiffs identify the issues in respect of their claim for conspiracy as whether the Defendants combined to perform overt acts; whether those overt acts were unlawful; whether the Defendants combined to perform any such unlawful overt acts pursuant to an agreement with a purpose of causing harm to the Plaintiffs and, if not, whether the Defendants combined to perform those lawful overt acts pursuant to an agreement with the sole or dominant purpose of causing harm to HSFS. The Plaintiffs rely on each of the allegedly unlawful overt acts set out in the particulars to paragraph 79 of the Amended Statement of Claim. Although I have referred to the "Plaintiffs" in this summary of the allegation, it should be noted that JRC and HSFS (not SFSI) are the Plaintiffs in the proceedings and that the claim for conspiracy is brought only by HSFS and not by JRC, so that matters involving JRC and SFSI will generally be irrelevant to that claim. 250The elements of the tort of conspiracy were summarised by McDougall J in Ballard v Multiplex [2012] NSWSC 426 at [65]-[69] as follows: "At common law, the parties to an agreement may incur civil liability to a third party if by their agreement they "combine" for the purpose of causing harm to that third party; if they execute their agreement by the performance of overt acts; and if thereby the third party does suffer harm. An actionable conspiracy may be one to be performed by legal or by illegal acts. In the first category, it must be the sole or predominant purpose of the conspiracy to cause harm to the third party. In the second category, it must be a purpose of the conspiracy to cause harm to the third party. To prove the (or a) purpose of a conspiracy, it must be shown either that the parties agreed on that purpose or that one party, having that purpose, made it known to the other or others, and that the other or others, having that knowledge, joined or continued with or performed the conspiracy. The purpose of a conspiracy (or combination) is not necessarily to be identified with its immediate result. For example, merchants may combine for the purpose of enhancing their business and profits. The inevitable result of that combination may be that a competitor is ruined. Indeed, the ruin of a competitor may be the means by which they intend to achieve their purpose. But the law seems to recognise that such a combination would not be actionable (leaving aside, of course, any statutory prohibitions), because the purpose was lawful even though both the result and the means to the achievement of that purpose was the ruin of a competitor. See Mogul Steamship Co v McGregor Gow & Co [1892] AC 25. As Viscount Simon LC put it in Crofter Hand Woven Harris Tweed Co v Veitch [1941] UKHL 2; [1942] AC 435 at 445, "the test is not what is the natural result to the plaintiffs of such combined action, or what is the resulting damage which the defendants realise or should realise will follow, but what is in truth the object in the minds of the combiners when they acted as they did. It is not consequence that matters, but purpose..." 251The Defendants submit that HSFS has not made out and could not make out the elements of conspiracy and refer to the identification of those elements by Foster J in Danthanarayana v Commonwealth of Australia [2014] FCA 552 at [69]-[75] (referring in particular to McKernan v Fraser [1931] HCA 54; (1931) 46 CLR 343 at 361-362 per Dixon J and at 398-403 per Evatt J) as requiring that the defendants to such a claim be party to a combination of acts whose sole, true, dominant or main purpose was the wilful infliction of damage upon the plaintiff and that the combination possesses the additional character or quality of being malicious. The Defendants submit that the adoption of a course that necessarily interferes with a plaintiff in the exercise of its business and thus injures it is not enough to establish conspiracy and that it is not enough that damage is intended if the motive that actuates the Defendants is not the desire to inflict injury. 252HSFS identifies several overt acts that are said to constitute the basis of the conspiracy, namely (1) the alleged breaches of the 2004 Agreement on which the Plaintiffs rely elsewhere in their claims (failure to deposit escrow code, failure to provide updates and development services, and the entry by Tanmari into an agreement granting a non-exclusive licence to FIPL in 2005); (2) the entry into the FIPL Purchase Agreement in 2011, the provision of source code to FIPL and assignment of rights to FIPL without HSFS's consent; (3) FIPL making representations to third parties that the Plaintiffs did not have rights to QSS and later that there would be litigation involving HSFS and that third parties should acquire products from FIPL (Ex P2 371); and (4) the purported termination of the 2004 Agreement. I have reached factual findings in respect of several of those matters above and will not repeat those findings here. 253HSFS contends that the relevant acts were unlawful, in the sense that they were a breach of contract and not an act that the Defendants were at liberty to do, and gave the Plaintiffs an actionable claim against the Defendants: Dresna Pty Ltd v Misu Nominees [2004] FCAFC 169 at [16] per Kiefel and Jacobson JJ. I have addressed the question of breach of contract by Mr Cummings and Tanmari above and do not repeat the analysis of that issue. I have held that a breach of cl 5 of the 2004 Agreement was established in respect of the failure to enter an escrow agreement, although I noted that HSFS's approach to the escrow agreement contributed to that result and it was also in breach of that clause; that the assignment of Tanmari's rights under the 2004 Agreement and in the QSS software to FIPL without HSFS's consent breached the 2004 Agreement, although I accept Mr Cummings' evidence that he then understood (I interpolate, incorrectly) that agreement had lapsed at the end of the seven-year period referred to in that agreement; and that Tanmari's termination of the 2004 Agreement was not effective, both because HSFS was not under an obligation to pay licence fees for licences it had not granted (albeit, on my findings, SFSI was in breach of copyright in that regard) and because Tanmari had assigned its rights under that agreement to FIPL. It follows that several of the relevant acts were unlawful, in the sense that they were in breach of contract by Mr Cummings and/or Tanmari. No breach of contract is established against FIPL since it was not party to any contract with HSFS, either before or after the assignment of the rights under the 2004 Agreement to it. 254HSFS also contends that FIPL's representations during the term of the 2004 Agreement that HSFS was infringing copyright were unlawful as they were contrary to s 202 of the Copyright Act giving HSFS an actionable claim against FIPL. This allegation relies on a communication from Mr Taylor to Golden Homes on 21 December 2011 (Ex P2 371) which refers to a "court battle looming between [Mr Cummings] and SFS[I]" as to the right to use the source code". The Plaintiffs refer to Mr Taylor's evidence as support for the proposition that the claim was made in relation to HSFS; however, I consider the contemporaneous email is a more reliable indicator of the content of the conversation which was directed to SFSI's position, and that finding is supported by the fact that SFSI rather than HSFS was then active in the market. The findings that I have reached above would have the result that an allegation that HSFS was infringing copyright would not have been correct, since it had substantially ceased business, was not dealing with new clients since April 2009 and any continuing sub-licenses granted by it to its existing customers, at the expiry of the seven year term, were permitted by the 2004 Agreement. However, to the extent the communication involved an implied allegation of infringement of copyright, that allegation was directed against SFSI which does not bring a claim in conspiracy and, on my findings, was justified since SFSI was in fact infringing that copyright and would not have contravened that section. 255HSFS accepts that, in order to establish a claim for conspiracy committed by unlawful means, it must establish that one of the purposes of the Defendants was to harm HSFS (Williams v Husey [1959] HCA 51; (1959) 103 CLR 30) and it points out that it is sufficient if one of the parties had the purpose, made it known to the others, and the others having that knowledge, joined in or continued with or performed the conspiracy (Ballard v Multiplex above at [66], [73]). HSFS refers to numerous matters on which it relies to support a finding that Mr Cummings, Tanmari and FIPL acted together in taking the relevant acts and, at least implicitly, that one of the purposes of those acts was to harm HSFS. I have had regard to all of the matters referred to, many of which are addressed elsewhere in this judgment, but I do not consider it necessary to deal with them individually at length in order to explain the findings that I have reached as to this issue. I will, however, make several brief comments about them. HSFS submits, and I accept, that it can be inferred that Mr Cummings, Tanmari and FIPL acted together in respect of the purported termination of the 2004 Agreement, and they did not contend to the contrary. HSFS characterises the claim by Tanmari for unpaid licence fees of "only $39,000 + GST" that had been outstanding for up to two years as involving a "relatively minor breach" of the 2004 Agreement. I do not accept the characterisation of the non-payment of that amount for that period as "minor". HSFS also points to communication(s) by Mr Taylor, for FIPL, to customers and potential customers referring "court battles" about HSFS's right to use QSS. As I noted above, its seems to me that the relevant communication was directed to SFSI rather than HSFS. That communication also seems to me to involve somewhat aggressive competitive conduct, which was intended to advance FIPL's commercial interests rather than to damage HSFS. HSFS submits that Mr Taylor held "animus" against Mr Pacione, and I accept that the evidence indicated at least that Mr Taylor did not hold Mr Pacione in high regard. It does not seem to me that matter, alone or with other matters, including the criticisms that HSFS makes of Mr Taylor's demeanour or Mr Cummings' evidence (to which I have referred above) establishes a purpose of harming HSFS. 256I have had regard to all of the matters to which the Plaintiffs refer. I do not consider that they, or the evidence generally, establishes that one of the purposes of the entry into the FIPL Purchase Agreement or the termination of the 2004 Agreement was to harm HSFS. So far as the entry into the FIPL Purchase Agreement in October 2011, by which Mr Cummings and Tanmari sold their business including QSS to FIPL is concerned, the Defendants contend that that was a commercial decision that had nothing to do with HSFS. Mr Cummings' evidence was that FIPL (or its predecessor) had been offering to purchase QSS from Mr Cummings and Tanmari since the time of the memorandum of understanding was entered into in September 2005 (Ex P2, pp 154Aff). It seems to me that the purpose of Mr Cummings and Tanmari in respect of entry into the FIPL Purchase Agreement was to seek to realise value for QSS and the purpose of FIPL in entry into the FIPL Purchase Agreement was to take advantage of the commercial opportunities that ownership of QSS might offer. The transaction would have had no impact (on the findings that I have reached) on the sub-licences that HSFS granted to its customers prior to April 2009, which were preserved under the 2004 Agreement, and it was not dealing with new customers after April 2009. No doubt, any competitive advantage obtained by FIPL might give rise to a consequential disadvantage to SFSI, which had largely assumed HSFS's business from at least April 2009. However, that is a consequence of advancing FIPL's interests in a competitive market and does not establish any purpose of damaging SFSI, which does not in any event bring a conspiracy claim. So far as Mr Cummings and Tanmari's failure to seek HSFS's consent for the transfer of QSS by entering into the FIPL Purchase Agreement in October 2011 is concerned, the Defendants point to Mr Pacione's evidence that the last licence granted by HSFS was in February 2009 (T100, 113); that HSFS was not 'doing any business' by April 2009 (T97-98,114); and thereafter, all licences and renewals were granted by SFSI. The Defendants also point out that HSFS ultimately consented to the sale to FIPL, which, on the Plaintiffs' case, includes the assignment of the 2004 Agreement (Amended Statement of Claim [43], [58], [65]). 257HSFS also contests the validity of termination of the 2004 Agreement on that basis that SFSI, rather than HSFS, had granted the relevant licences. I do not accept HSFS's submission that that was done "in full view" of the market, since HSFS, SFSI and Mr Pacione were not transparent, at least from April 2009 until December 2012, as to the number of licences granted or the basis on which they were granted. I also do not accept that the fact that the basis of termination of the 2004 Agreement on which the Defendants relied has ultimately not been established supports any inference of an intention to harm HSFS, given the complexity of the relevant legal issues. It seems to me that the purpose of termination of the 2004 Agreement was defensive, so as to seek to preserve the Defendants' rights against an apprehended (and, on my findings in respect of SFSI, existing) copyright infringement, and preserve the value of the asset that FIPL had purchased against such use, rather than to harm HSFS. 258HSFS also accepts that a conspiracy committed by lawful means can only be established if the sole, true, or dominating or main purpose of the conspiracy is to harm the plaintiff: McKernan v Fraser above at 362. It follows from the findings that I have reached above that such a purpose has not been established. The Defendants also submit, and I accept, that HSFS has not established damage so as to make good a claim in conspiracy, because it had ceased trading with new customers or was inactive from April 2009. HSFS submits that contention is not open to the Defendants since it was not expressly pleaded in paragraphs 78-83 of the Defence. I do not accept that submission. The issue emerged from Mr Pacione's cross-examination and there seems to me to be no relevant prejudice to HSFS in proceeding on the basis of facts that were known to Mr Pacione at all relevant times and were the subject of his evidence. If leave were necessary, I would have granted it where the alternative would be to determine a claim for conspiracy on a false basis arising from the exclusion of highly relevant evidence. It does not seem to me that such leave is necessary where HSFS addressed the issue in submissions. 259The Defendants refer to the oral evidence of Mr Pacione (T97-98, 100; 104, 106, 108-109, 113-114) and submit that Mr Pacione's decision to cease to undertake business in HSFS by at least April 2009 had nothing to do with their conduct. HSFS contends that it has a claim even if it is not currently trading, since it is still a registered company and has the ability to trade (Ex P2 106) and that it still has market presence and it still appears at trade shows (albeit, I interpolate, together with SFSI) so it has goodwill and reputation (T153). It does not seem to me that it has been established that any of the acts alleged to give rise to the relevant conspiracy caused any damage to HSFS in that regard. HSFS also submits that it has valuable rights under the 2004 Agreement. However, HSFS is not using those rights in respect of new customers; and the Plaintiffs do not contend that customers' rights to use software previously licensed to them are affected by the purported termination of the 2004 Agreement. 260The claim for conspiracy therefore fails. Misleading or deceptive conduct - website and representations to customers and potential customers (Amended Statement of Claim [6], [84]-[96]) (Plaintiffs' issues 35 (where second occurring) - 41) 261The Plaintiffs identify the issues in respect of these claims as whether FIPL was engaged in trade or commerce between Australia and another country or engaged in conduct involving the use of telegraphic or telephonic services; whether FIPL made or was involved in making representations on a specified website; whether FIPL made certain representations to customers and potential customers; and whether those representations were misleading or deceptive. The Defendants admit making the alleged representations. They submit that whether they are false will follow the determination of the Court on the contract claim and that, if the Plaintiffs' case in breach of contract fails, then the ancillary claims for misleading or deceptive conduct must also fail. 262The Plaintiffs identify an issue whether FIPL was engaged in trade or commerce between Australia and another country; or engaging in conduct involving the use of telegraphic or telephonic services. They submit that FIPL, although incorporated in New Zealand, engaged in trade or commerce in Australia or between Australia and another country for the purposes of s 6(2)(a)(i) of the Competition and Consumer Act 2010 (Cth), by its entry into an agreement with Tanmari by which Tanmari granted FIPL a non-exclusive licence to resell copies of QSS (Cummings 4.12.12 [124]) and by its purchase of Mr Cummings' and Tanmari's business which was located in Australia and where the governing law of the FIPL Purchase Agreement is the law of Australia (FIPL Purchase Agreement cl 9.11; Ex P2 330). They also submit that FIPL's conduct involves an internet website, and therefore involves the use of telegraphic or telephonic services, at least so far as that website was accessible in Australia, for the purposes of s 6(3)(a) of the Competition and Consumer Act. I do not understand FIPL to have contended to the contrary. 263The Plaintiffs submit that FIPL made representations or was involved in making representations on a website with a domain name referring to "Quikseries" (Ex P2 394) which is registered to FrameCAD Ltd not FIPL. They submit that FIPL was making the representations or was involved in making the representations, because the website says "FrameCAD acquired the rights" and refers to "our rights" and FIPL acquired those rights under the FIPL Purchase Agreement and claims that it owns copyright; and the website says "our lawyers" have written to the company and those lawyers said they acted for FIPL (Ex P2 361, 389). I do not accept this submission, since the statements on the website can readily be understood as referring to the FrameCAD group of companies. It seems to me that, where the representations were made on a website registered to FrameCAD Ltd, it and not FIPL made those representations, and it is not a defendant in the proceedings. This claim should fail for that reason alone. 264The Plaintiffs contend that several representations were misleading or deceptive, namely, that dealing with FIPL is the "only" way to ensure that users have the legal right to use QSS; that users "need" to obtain a "valid" licence "exclusively" from FIPL; and "another company" has claimed that it is "entitled" to grant licences and "our lawyers have formally written" to this company. I accept the Plaintiffs' submission that the statements on the website represent that JRC and HSFS do not have rights in QSS, with the qualification that I understand those representations to be directed to the right to grant licences to new customers or renew expired licences. The Plaintiffs submit those statements are misleading or deceptive because JRC owns or has a non-exclusive licence in QSS under the 2002 Agreement; JRC and HSFS have an implied licence in QSS; and HSFS has a non-exclusive licence in QSS under the 2004 Agreement. 265The approach to be adopted in determining whether conduct amounts to misleading or deceptive conduct is well-established. Whether conduct is misleading or deceptive is a question of fact and is determined by whether, viewed objectively, the relevant conduct was misleading or deceptive or likely to mislead or deceive, and conduct is likely to mislead or deceive if there is a real and not remote chance or possibility that a person is likely to be misled or deceived: Taco Co of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 at 199 per Deane and Fitzgerald JJ; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191 at 197 per Gibbs CJ, 216 per Brennan J; Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; (2004) 218 CLR 592 at [112] per McHugh J. 266The substance of the relevant representation was that a licence issued by FIPL was the "only" way to ensure that users have the legal right to use QSS and that persons who wished to obtain a "valid" licence could only obtain it "exclusively" from FIPL. I have held above that SFSI did not have any rights to QSS and JRC and HSFS did not, at that time, have any rights in QSS arising under the 2002 Agreement or by an implied licence, and the representation was accurate so far as it depended on those matters. It was inaccurate, and potentially misleading or deceptive or likely to mislead or deceive, so far as it suggested that HSFS could not have granted rights to QSS arising under the 2004 Agreement, so far as it continued beyond the seven-year period as noted above. However, it does not seem to me that the Plaintiffs have in fact made good a claim for misleading or deceptive conduct in that regard, because, while HSFS could have taken that course, it was not then doing so. The statement that FIPL was the only source of a valid licence for QSS was accurate, as a matter of substance, so far as HSFS was not granting such rights, although it could have done so, and SFSI, which was purporting to grant such rights, had no entitlement to do so. There seems to be no basis for a suggestion that the further representations that "another company" (relevantly, SFSI) had claimed that it was "entitled" to grant licences and that "our lawyers have formally written" to this company were not correct. 267The Plaintiffs also contend that FIPL made statements to third parties (or at least one party addressed by the evidence) that there was a "court battle looming" about HSFS' right to use QSS and that any customer who wanted the right to use QSS should sign with FrameCAD "so as not to be caught up in the crossfire" (Ex P2 371; Pacione 19.3.14 JP4-M). FIPL and Mr Taylor accept that he made a telephone call to that entity (Defence [92(b)] and Taylor 31.10.13 [78]) and I find that he encouraged that entity to obtain a licence from FIPL. The Plaintiffs submit that FIPL's statement was a representation that HSFS did not have the rights to QSS as at 21 December 2011. The representation that a court battle was looming was plainly correct. Assuming, without deciding, that the representation that any customer who wanted to sign with QSS should sign with FIPL "so as not to be caught up in the crossfire" can be read as anything more than a sales pitch, it seems to me not to have been directed to the question whether HSFS had legal rights to QSS, which would have been of no interest to a potential customer for its own sake, but to the practical question where a potential customer could obtain a licence for QSS. To the extent the representation conveyed that licences could be obtained from FIPL rather than HSFS, it does not seem to be misleading or deceptive. Such rights could be obtained from FIPL which had acquired the ability to grant them under the FIPL Purchase Agreement and they could not be obtained from HSFS, because it was not then granting such rights, although it could have done so, and SFSI which was then purporting to grant such rights had no entitlement to do so 268The Plaintiffs' claim for misleading or deceptive conduct is therefore not established. Unconscionability - Tanmari (Amended Statement of Claim [5], [97]-[105]) (Plaintiffs' issues 42-47) 269The Plaintiffs identify the issues in respect of this claim as whether Tanmari was a corporation engaged in trade or commerce within the meaning of ss 20 and 21 of the Australian Consumer Law; whether the Plaintiffs were under a special disadvantage that was known to Tanmari; whether Tanmari unconscientiously took advantage of the Plaintiffs' special disadvantage within the meaning of the unwritten law for the purposes of s 20 of the Australian Consumer Law; whether Tanmari has engaged in conduct in connection with supply or possible supply of goods or services to a person within the meaning of s 21 of the Australian Consumer Law; and Tanmari has engaged in conduct that is in all the circumstances unconscionable within the meaning of s 21 of the Australian Consumer Law. The Defendants submit that this claim must fail because neither JRC nor HSFS had any special disadvantage, where Mr Pacione engaged his own solicitors to draft the various agreements (T123-124) and there are software packages other than QSS that could be utilised by the Plaintiffs in their business (McLauchlan T229; Pacione T77). 270This claim firstly relies on s 20 of the Australian Consumer Law which prohibits a person, in trade or commerce, engaging in conduct that is unconscionable within the meaning of the unwritten law from time to time. The section does not apply to conduct that is prohibited by s 21 of the Australian Consumer Law to which I will refer below. The Plaintiffs refer to the well-established principle that the Court may grant relief on the ground of unconscionable conduct where a party makes unconscientious use of their superior position or bargaining power to the detriment of a party who suffers from some special disability or is placed in some special situation of disadvantage: Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447 at 462 per Mason J. In Australian Competition and Consumer Commission v CG Berbartis Holdings Pty Ltd [2003] HCA 18; (2003) 214 CLR 51, the High Court held that unconscionability is not established merely because a party takes advantage of a superior bargaining position in its dealings with another party. Several later cases suggest that special disadvantage may need to be established in order to establish unconscionability under this section and corresponding sections, and the Plaintiffs appear to proceed on that basis in their submissions: for example, Australian Competition and Consumer Commission v Samton Holdings Pty Ltd [2002] FCAFC 4; (2002) 117 FCR 301 at [48]; AMP Financial Planning Pty Ltd v CGU Insurance Ltd [2004] FCA 1330; (2004) 139 FCR 223 at [72] per Heerey J. The concept of special disadvantage can include at least a disadvantage which "seriously affects the ability of the innocent party to make a judgment as to his own best interests, when the other party knows or ought to have known of the existence of that condition or circumstances and of its effect on the innocent party": Commercial Bank of Australia Ltd v Amadio above at 461; see also Credit Connect Pty Ltd v Carney [2010] NSWSC 910 at [48] per Macready AsJ. 271The Plaintiffs submit that JRC and HSFS were under a "special disadvantage" that was known to Tanmari in that, first, JRC and HSFS were "locked into" QSS as part of the Plaintiffs' product offering, the Hayes Base System. The Plaintiffs refer to matters both prior to and after the shift of HSFS's business of dealing with new customers to SFSI at least from April 2009 to support this proposition. It will be necessary to separate those matters by time period, in a manner that the Plaintiffs do not, for reasons that will emerge below. So far as the Plaintiffs rely on events prior to April 2009, they point to Mr Pacione's evidence that he explained to Mr Cummings when he first met him in 2002 that he wanted to use QSS as a component of a steel frame manufacturing system, and point out that intention is reflected in Recital B of the 2002 Agreement to which I have referred above and in other documents provided by Mr Pacione to Mr Cummings in 2002. The Plaintiffs point out that JRC and later HSFS "licensed" QSS (although that submission should be qualified by the findings as to the nature of JRC's rights to which I have referred above) and paid significant amounts for development, modifications and services relating to QSS. They point out, and I accept, that the Hayes Base System was developed using QSS as a component and other software programs that interoperated with QSS were also developed. 272The Plaintiffs also submit that they were "locked in" to IntelliCAD, although that submission depended upon the premises both that they were "locked in" to QSS and that no other CAD program would operate with QSS. It does not seem to me that the Plaintiffs have established that they are dependent on QSS or IntelliCAD in the manner that they indicate. I accept that their use of QSS was plainly advantageous to them, but it has not been established that they could not access other substitutable products in the market if they were not permitted to use QSS, or that such other products would only operate with IntelliCAD. 273I do not accept that a "special disadvantage" was established in respect of the matters to which I have referred above, prior to April 2009, because any vulnerability which the Plaintiffs might otherwise have had as a result of these matters was addressed by the facts that they were successful commercial entities in a competitive market, who were dealing with Mr Cummings who was plainly not a sophisticated businessperson and Tanmari which was a small business; that they, or Mr Pacione, had drafted the relevant agreements in a manner that would adequately protect their interests; that HSFS was legally represented and Mr Cummings and Tanmari were not in entry into the 2004 Agreement; and that HSFS and Mr Pacione had sufficient sophistication to subsequently seek, albeit unsuccessfully, to substantially improve HSFS's position under the proposed draft escrow agreement, and then to shift HSFS's business of dealing with new customers to SFSI in April 2009 with the result that SFSI licensed (or purportedly licensed) QSS to customers but did not pay licence fees to Mr Cummings or Tanmari in doing so. 274So far as the position after April 2009 is concerned, special disadvantage is not established because HSFS has had no substantial business since at least April 2009, and is under no present disadvantage in any substantive relationship with Tanmari since that date, where its business substantially ceased at that date and SFSI commenced dealing with customers in a manner that avoided the need to pay licence fees under the 2004 Agreement. If it were relevant, SFSI is also not under any disadvantage in any relationship with Tanmari, because it has no such relationship; and, to the extent that SFSI (rather than the Plaintiffs) offered a product that incorporates QSS, any vulnerability on its part arose from its failure to seek any rights to do so from Tanmari, and its apparent wish to do so without paying licence fees that would likely have been payable had it sought such rights, not from any conduct of Mr Cummings or Tanmari. 275The Plaintiffs next identify the question whether, if JRC or HSFS is under any special disadvantage, Tanmari unconscientiously took advantage of their special disadvantage in a manner that was unconscionable within the meaning of the unwritten law within the meaning of s 20 of the Australian Consumer Law. This question does not arise, since the Plaintiffs have not established that they are under any special disadvantage in dealing with Tanmari for the reasons noted above. I will nonetheless briefly refer to the Plaintiffs' submissions as to this matter. 276The Plaintiffs contend that Tanmari unconscientiously took advantage of their special disadvantage (which, as noted above, has not been established) by reason of the same matters that they relied on to establish breach of contract and conspiracy. These include (without repeating the full list of matters) that (they contend) Tanmari did not provide available updates as required by cl 2.4 of the 2004 Agreement; Tanmari did not provide development services as required by cl 4 of the 2004 Agreement; Tanmari did not deposit source code with an escrow agent and enter into an escrow agreement as required by cl 5 of the 2004 Agreement and failed to offer alternative escrow agents or negotiate a draft escrow agreement; Tanmari entered into the FIPL Purchase Agreement and agreed to deliver possession and control of the source code to FIPL and did not take any steps to novate the 2004 Agreement to FIPL or seek HSFS's consent to the assignment of the 2004 Agreement to FIPL; Tanmari did not provide assistance to HSFS in relation to the release of IntelliCAD version 7; Tanmari purported to give notice that HSFS was in breach of the 2004 Agreement; Tanmari purported to terminate the 2004 Agreement without following the dispute resolution process in cl 10 of that agreement; and Tanmari purported to terminate the 2004 Agreement for HSFS failing to pay licence fees "in circumstances where it had not taken any steps previously to chase up the licence fees, the licence fees were relatively insignificant and the failure to pay licence fees was up to 2 years old". The Plaintiffs also submit that: This "accumulation of incidents" discloses a case of unreasonable and unfair behaviour that amounts to unconscionable conduct - Australian Competition and Consumer Commission v Simply No-Knead (Franchising) Ltd (2000) 104 FCR 253 at [51] per Sundberg J. 277I have addressed these matters above in respect of the claims for breach of contract and conspiracy. I have held that some of those matters did not breach the 2004 Agreement, although others did, and that the Plaintiffs' claims in conspiracy are not established as to those matters. So far as these matters are reformulated as a claim for unconscionability based on special disadvantage, they do not succeed because "special disadvantage" is not established at the relevant time. I also do not consider that these matters, separately or together, involve any element of unconscientious conduct on the part of Mr Cummings or Tanmari, a fortiori in circumstances that, from April 2009, the licensing business of Mr Pacione's companies was being conducted substantially through SFSI which had no relationship with Mr Cummings or Tanmari. 278Next, the Plaintiffs bring a claim for unconscionability in the supply of goods under s 21 of the Australian Consumer Law. It appears that the relevant form of that section is that which applied prior to amendments made by the Competition and Consumer Legislation Amendment Act 2011 (Cth) with effect from 1 January 2012, although the parties did not address that matter in submissions. The former section prohibited a person, in trade or commerce, in connection with the supply or possible supply of goods or services to a person (other than a listed public company), engaging in conduct that is, in all the circumstances, unconscionable. Section 21(2) set out a list of factors to which the Court may have regard in determining whether the section was contravened, which include the relative strengths of the bargaining positions of supplier and consumer; the intelligibility of the relevant documents; undue influence or unfair tactics; and the amount for which a consumer could have acquired identical or equivalent services from another supplier. 279I accept that the supply of software is a supply of goods, because "goods" includes is defined to include computer software in s 2 of the Australian Consumer Law, and that Tanmari's licensing QSS to HSFS, and the provision of other services to HSFS under the 2004 Agreement, were within the scope of that section. I do not understand Tanmari to have contended to the contrary. However, s 21(5) of the then Australian Consumer Law provided that a reference to "goods or services" in the section is a reference to goods or services of a kind ordinarily acquired for personal, domestic or household use or consumption. The parties did not address submissions to this limitation. I find it difficult to see that specialist computer software used in the operation of rollforming machines for, inter alia, roofing components could possibly fall within this concept and within the scope of the section. There is also a question, also not addressed by the parties, as to whether the relevant conduct would be excluded from the section, by s 21(6) of the Australian Consumer Law, so far as the software was supplied for the purposes of resupply by JRC or HSFS or transforming it (by incorporating it the Hayes Base System) in trade or commerce. However, it is not necessary to address these matters given the findings that I have reached below. 280The Plaintiffs submit, and I accept, that the meaning of "unconscionability" in s 21 of the Australian Consumer Law is not limited to the meaning of the word according to established principles of common law and equity, and involves conduct which is clearly unfair or unreasonable, normally involving some moral fault or moral responsibility: Australian Securities and Investments Commission v National Exchange Pty Ltd [2005] FCAFC 226; 148 FCR 132 at [30]; Tonto Home Loans Australia Pty Ltd v Tavares [2011] NSWCA 389 at [291] per Allsop P (with whom Bathurst CJ and Campbell JA agreed); Freier v Australian Postal Corporation (No 2) [2012] NSWSC 61 at [21] per Ball J. The Plaintiffs rely on the conduct to which I have referred above in respect of their claim under s 20 of the Australian Consumer Law to support their further claim under this section. They do not, in submissions, point to any particular matter which would indicate a different result in applying the two sections to the same conduct, although I accept, of course, that is a possibility where the terms of the sections differ. In this case, it does not seem to me that the conduct on which the Plaintiffs rely on the part of Tanmari has a quality of clear unfairness or involved moral fault so as to give rise to a contravention of the section, for all the reasons I have noted above in addressing the conduct on which the Plaintiffs rely. 281The Plaintiffs also rely on: "Tanmari's unreasonable failure to disclose Tanmari's intended conduct that would affect [HSFS's] interest and unreasonably failed to disclose any risks to [HSFS] arising from [HSFS's] conduct that Tanmari should have foreseen would not be apparent to [HSFS]." This submission does not identify which conduct of Tanmari it is intended to refer to or when or why the suggested disclosure should have been made. If the proposition is directed to a failure to disclose Tanmari's intended entry into the FIPL Purchase Agreement, then it seems to me that Tanmari's not disclosing that matter does not have a quality of clear unfairness or involve moral fault so as to give rise to a contravention of the section, where HSFS had not paid licence fees to Tanmari for a considerable period prior to the transaction and had, without disclosure on its part to Mr Cummings or Tanmari, substantially ceased to conduct business when SFSI began to sublicense QSS to customers without the payment of such licence fees. Unconscionability - FIPL (Amended Statement of Claim [6], [106]-[111]) (Plaintiffs' issues 48-50) 282The Plaintiffs also bring a claim for unconscionability against FIPL. The Plaintiffs identify the issues in respect of this claim as whether FIPL was engaged in trade or commerce between Australia and another country or engaging in conduct involving the use of telegraphic or telephonic services; whether the Plaintiffs were under a special disadvantage that was known to FIPL; and whether FIPL unconscientiously took advantage of the Plaintiffs' special disadvantage. 283I proceed on the basis that FIPL was engaged in trade or commerce between Australia and another country or engaged in conduct involving the use of telegraphic or telephonic services and I do not understand the Defendants to have contended to the contrary. The Plaintiffs again submit that JRC and HSFS were under a special disadvantage because they were "locked in" to QSS and IntelliCAD and that FIPL knew about this special disadvantage. I do not accept that these matters establish a special disadvantage, for the reasons noted above, and it is therefore not necessary to deal with the question of FIPL's knowledge in that regard. The Plaintiffs also submit that HSFS was under a "special disadvantage" because HSFS became FIPL's licensee and customer without any direct contractual relationship with FIPL, so far as the operation of the Copyright Act meant that Mr Cummings and Tanmari assigned the copyright to FIPL, and the licence to HSFS under the 2004 Agreement was binding on FIPL as a successor in title, under s 196 of the Copyright Act. I also do not accept that submission since, as I have noted above, HSFS was not undertaking any substantive business at that time; its rights were sufficiently protected by s 196 of the Copyright Act; and, to the extent that customers sub-licensed by HSFS prior to April 2009 had rights to continue using QSS, those rights were not prejudiced by the FIPL Purchase Agreement. 284It is also therefore not necessary to deal with the Plaintiffs submission that FIPL unconscientiously took advantage of HSFS's "special disadvantage" by entry into the FIPL Purchase Agreement. I note, however, that the Plaintiffs submit that FIPL entered into an agreement with Tanmari and Mr Cummings that required Tanmari and Mr Cummings to provide all copies of QSS to FIPL and that Tanmari could not then perform its obligations under the 2004 Agreement to deposit the source code with an escrow agent and Tanmari could not provide the source code to HSFS or an independent developer to modify QSS and IntelliCAD 7 so that they were compatible and interoperable. The Plaintiffs also submit that the FIPL Purchase Agreement restricted Tanmari and Mr Cummings from providing development and support services on the technology or technology that was similar to QSS, so that they could not modify QSS and IntelliCAD 7.2 so that they were compatible and interoperable, or provide assistance to an independent developer to do so. The Plaintiffs also submit that FIPL did not take any steps to seek HSFS's consent to Tanmari's assignment of the 2004 Agreement or to novate the 2004 Agreement. The Plaintiffs again submit that this "accumulation of incidents" discloses a case of unreasonable and unfair behaviour that amounts to unconscionable conduct: Australian Competition and Consumer Commission v Simply No-Knead (Franchising) Pty Ltd [2000] FCA 1365; (2000) 104 FCR 253 at [51] per Sandberg J. 285I have addressed broadly similar submissions in respect of the claims for breach of contract and conspiracy above. Had it been necessary to determine this matter, I would not have held that any element of moral obloquy or unconscionable conduct was established on the part of FIPL, where HSFS had at that time substantially ceased business and new licences were being granted by SFSI in breach of copyright and without payment of licence fees to Tanmari. I also note that - if, contrary to the fact, HSFS had in fact been conducting any substantive business - the premise of this submission, that the FIPL Purchase Agreement would deprive it access to QSS to which it is otherwise entitled, would not be established so far as FIPL was bound by any obligations which attached to Tanmari as the successor to the copyright owner. Tort of inducing breach of contract - FIPL Purchase Agreement (Amended Statement of Claim [112] - [116]) (Plaintiffs' issues 51-54) 286The first claim as to the tort of inducing breach of contract relates to the FIPL Purchase Agreement. The Plaintiffs identify the issues in respect of this claim as whether Tanmari's entry into the FIPL Purchase Agreement breached the 2004 Agreement; whether FIPL induced or procured Tanmari to enter into the FIPL Purchase Agreement; whether FIPL had sufficient knowledge of the terms of the 2004 Agreement to know that it was a breach of the 2004 Agreement; and whether FIPL had the intention for Tanmari to breach the 2004 Agreement or was recklessly indifferent or wilfully blind to the breach. The Defendants submit that there has been no breach of the 2004 Agreement by Tanmari and a claim for the tort of inducing breach of contract cannot be made out on that basis. They also deny that the elements of such a claim are established so far as FIPL is concerned. 287The Plaintiffs identify the first issue as to this claim as whether Tanmari's entry into the FIPL Purchase Agreement breached the 2004 Agreement. The Plaintiffs point out (repeating a submission to which I have referred several times above) that cl 4.2 of the FIPL Purchase Agreement required Tanmari and Mr Cummings to provide all copies of the source code for QSS to FIPL and that cl 7.2 of the FIPL Purchase Agreement also provided that they would not provide development, support or maintenance for QSS to any person other than FIPL during the restraint period, which is 5 years. The Plaintiffs submit that the inevitable consequence of Mr Cummings and Tanmari entering into the FIPL Purchase Agreement was that Tanmari and Mr Cummings could not perform and would inevitably breach its obligations under cl 2.3(c) (which is contended to require that QSS be compatible with IntelliCAD version 7.2), cl 2.4 (provide updates immediately they become available), cl 3 (provide information and assistance), cl 4 (provide development services), and cl 5 (escrow agreement) of the 2004 Agreement. I do not accept this submission. I have held above that cl 2.3 of the 2004 Agreement does not impose the requirement as to compatibility with IntelliCAD version 7.2 for which the Plaintiffs contend; second, the entry into the FIPL Purchase Agreement did not result in an inevitable breach of these obligations, because it was not inevitable that FIPL would not consent to Mr Cummings or Tanmari complying with them, particularly if a court held they continued to exist; it was not inevitable that FIPL would not comply with those obligations itself, to the extent that it had been assigned the benefits under the agreements; and the provisions of the Copyright Act dealing with the position of a successor to a copyright holder, to which I have referred above, may have caused or encouraged FIPL to do so. I have, however, held that the entry into the FIPL Purchase Agreement breached cl 13.2 of the 2004 Agreement which required Tanmari to obtain HSFS's consent before assigning QSS or the 2004 Agreement, although there may be a question whether any loss would follow from that breach where HSFS has no substantial continuing business and has in any event consented to the assignment. 288The Defendants also submit that it is necessary to show the alleged tortfeasor procured or induced the breach of contract. In DC Thomson & Co Ltd v Deakin [1952] Ch 646 at 694; 2 All ER 361, Jenkins LJ observed that: "It is to be observed that in all these cases there is something amounting to a direct invasion by the third party of the rights of one of the parties to the contract, by prevailing on the other party, to do, or doing in concert with him, or doing without reference to either party, that which is inconsistent with the contract, or by preventing, by means of actual physical restraint one of the parties from being where he should be or doing what he should do under the contract." 289The Plaintiffs submit that FIPL "procured and induced" Tanmari to enter into the FIPL Purchase Agreement, but refer in submissions to no more than the entry into that agreement to establish that proposition. It is by no means self-evident that each contracting party can be said to procure or induce the other to contract. I am conscious, however, that there is other evidence that FIPL, through Mr Taylor, had opened a dialogue with Mr Cummings as to the possible sale of QSS to FIPL from early in their dealings, and it may be that that would be sufficient to amount to procuring or inducing the entry into the agreement. Mr Cummings accepted in cross-examination that FIPL had made several offers to buy (or at least had expressed an interest in buying) QSS in the period after he entered a memorandum of understanding with it in 2005, and approximately once a year in that period (T303). Mr Taylor's evidence was also that he had informal discussions with Mr Cummings about joining together in 2010 and 2011 (Taylor 31.10.13 [30]) and due diligence discussions in mid-2011 (Taylor 31.10.13 [39]). I do not consider it necessary to decide this issue where the parties have not made substantive submissions about it and this claim can be determined on other grounds. 290The next issues identified by the Plaintiffs, which the authorities indicate are related, concern intention and whether FIPL had sufficient knowledge of the terms of the 2004 Agreement to appreciate that Tanmari's entry into the FIPL Purchase Agreement was a breach of the 2004 Agreement. It is sufficient if FIPL had sufficient knowledge of the terms of the contract to appreciate that what it is inducing would breach the contract, go as to establish an intention to interfere with contractual rights: Sharjade Pty Ltd v Commonwealth of Australia [2009] NSWCA 373 at 130 per Hodgson JA; Allstate Life Insurance Co v ANZ Banking Group Ltd (1995) 58 FCR 26 at 43; 130 ALR 469 per Lindgren J (with whom Lockhart and Tamberlin agreed). The Defendants submit that the relevant intention requires that the conduct must "in some real sense be 'aimed at' the contract" (Oren v Red Box Toy Factory Ltd [1999] FSR 785 at 799 per Jacob J) such that there is a clear causal link between the defendant's conduct and the breach, and that it is insufficient that interference is the natural and probable consequence of the defendant's activities and that the defendants knew this to be the case. In Hospitality Group Pty Ltd v Australian Rugby Union Ltd [2001] FCA 1040; (2001) 110 FCR 157 at [127], the Full Court of the Federal Court observed that: "The gravamen of the tort of inducing breach of contract is intention. Although the requirement of knowledge of the contract is sometimes discussed as if it were a separate ingredient of the tort, it is in fact no more than an aspect of intention. The requirement that the alleged tortfeasor have sufficient knowledge of the contract is a requirement that he have sufficient knowledge to ground an intention to interfere with contractual rights. Both the intention to interfere with contractual rights and the necessary supporting knowledge of the contract refer to the state of mind of the alleged tortfeasor: All State Life Insurance Co v ANZ Banking Group Ltd (1995) 58 FCR 26 at 43." The Court may in an appropriate case infer such an intention from the surrounding circumstances: RPM v Marmax above at [239]. 291The Plaintiffs submit, and I accept, that FIPL knew (at least generally) of the existence of non-exclusive software licences relating to QSS, since it (or a predecessor) had entered a memorandum of understanding conferring such a licence in respect of QSS in 2005 (Ex P2 154A). Clause 3.3 of that memorandum of understanding disclosed that HSFS was receiving updates of the software, at least in 2005, because it required Mr Cummings to provide FIPL's predecessor entity with updates "similar to the mode of operation currently done by [HSFS]". As the Plaintiffs point out, the FIPL Purchase Agreement itself referred to the 2004 Agreement (and other third party contracts), defining the term "Contracts" as all contracts relating to the "Software", the "Vendor IP" (in turn defined as all "Intellectual Property" in and in relation to the "Software" including the source code for the "Software") and included the contracts listed in Schedule 2. That Schedule in turn refers to contracts with HSFS. It follows that FIPL knew that contracts with HSFS existed or at least had existed. 292Mr Cummings' evidence is that, when he was negotiating the sale of QSS to FIPL in about September/October 2011, he told FIPL that he did not have a copy of the 2004 Agreement at hand and that agreement had expired. His evidence is that it was his understanding, at that time, that the 2004 Agreement had expired and he therefore did not seek permission from HSFS to assign the 2004 Agreement to FIPL (Cummings 14.10.13 [98] - [99]). That understanding was not implausible where the base licensing structure for a seven year period contained in that agreement would have expired in August 2011, before the entry into the FIPL Purchase Agreement. 293Mr Taylor's evidence is that Mr Cummings provided FIPL with copies of Development Agreements, including the Beijing Hostec, Stramit and HCL Agreements in connection with the negotiations for the purchase of the software, and each contained an acknowledgement by HSFS that the source code for QSS and intellectual property belonged to Tanmari. The Plaintiffs point out that the Software Development Agreement relating to HCL also referred to the 2004 Agreement in the defined term "Source Software Licence" (Ex P2 140). Mr Taylor's evidence is also that he conducted due diligence in relation to the purchase by FIPL and had discussions with officers of Hayes International and Bradbury Group about that time in respect of the licensing arrangements between HSFS on the one hand and Mr Cummings and Tanmari on the other (Taylor 31.10.13 [39]). His evidence is that he requested a copy of the 2004 Agreement from Mr Cummings, but Mr Cummings could not locate it and he was informed by Mr Cummings that the 2004 Agreement had expired; he thought that HSFS had ceased doing business around 2009; and he had "very limited awareness" (admittedly, a somewhat imprecise description) of the terms of the 2004 Agreement and he had not read or seen a copy of that agreement until after receipt of a letter dated 18 November 2011 from the Plaintiffs' solicitors to Tanmari (Taylor 31.10.13 [33]-[39]; T353-354, 374-375). This evidence, at least so far as the state of Mr Taylor's knowledge is concerned, is corroborated by Mr Cummings' evidence of these matters, which I accept. It has not been established that Mr Taylor or FIPL had the necessary knowledge or intention as at 31 October 2011, when the FIPL Purchase Agreement was executed, to commit the tort of inducing breach of contract. 294The Plaintiffs also submit that: "Therefore, even though [FIPL] was not aware of the specific terms of the [2004] Agreement, it was aware that a licence of QSS Application would generally include a right to support and development, a right to updates and a warranty that QSS Application would be compatible with IntelliCAD. Therefore, it was sufficiently aware of the terms of the [2004] Agreement to appreciate that [Mr Cummings] and Tanmari's entering into the [FIPL] Purchase Agreement would inevitably lead to Tanmari breaching the [2004] Agreement." (emphasis added) I have held that the 2004 Agreement did not in fact include a warranty as to compatibility with IntelliCAD beyond version 4, with which QSS was already compatible, and no breach of the 2004 Agreement would arise in that respect from entry into the FIPL Purchase Agreement. I have not accepted that the entry into the FIPL Purchase Agreement would otherwise inevitably lead to a breach of the 2004 Agreement. The Plaintiffs do not submit that FIPL was aware of the prohibition on assignment without HSFS's consent, and no basis is therefore established for a claim for intentional interference arising from a breach of that prohibition. 295The Plaintiffs submit that the requisite intention should be inferred from the surrounding circumstances including that, as I noted above, Tanmari had also granted a non-exclusive licence in QSS to a predecessor of FIPL. The Plaintiffs also submit that FIPL operates in the same industry as HSFS and is a competitor to HSFS. This submission neglects the fact that, as I have noted above, HSFS had not any substantial business in that industry since new custom was diverted to SFSI from April 2009. It does not seem to me that these matters establish an intention to breach the 2004 Agreement. No question of any intention to interfere with any contractual relationship between SFSI - which was in truth FIPL's competitor at the relevant time - and Mr Cummings or Tanmari arises, both because it is not a plaintiff and brings no such claim, and because it had no contractual relationship with Mr Cummings or Tanmari. 296Alternatively, the Plaintiffs submit that, when FIPL entered into the FIPL Purchase Agreement, FIPL was recklessly indifferent or wilfully blind to Tanmari's breach of the 2004 Agreement. The Plaintiffs submit that, as I noted above, FIPL knew of the fact that the 2004 Agreement existed (or had existed) and had some awareness of its terms. The Plaintiffs then repeat the submission that the inevitable consequence of Tanmari entering into the FIPL Purchase Agreement was that Tanmari would breach the 2004 Agreement, a submission that I have not accepted above. Given the inquiries that FIPL and Mr Taylor had made, and the information that Mr Cummings had provided to them, I do not consider that reckless indifference or wilful blindness is established. 297The Defendants also point out that damage is also a necessary element of the tort of inducing breach of contract. The Defendants submit, and I accept, that HSFS has not established that it suffered such damage, where HSFS had, as I have noted above, ceased to undertake business with new customers before the FIPL Purchase Agreement was made and that transaction did not affect HSFS's ability to license QSS under cl 2.2 of the 2004 Agreement. Tort of inducing breach of contract - Purported termination of 2004 Agreement (Amended Statement of Claim [117] - [120]) (Plaintiffs' issues 55-58) 298The Plaintiffs identify the issues in respect of this claim as whether Tanmari's purported termination of the 2004 Agreement was a breach of that agreement; whether FIPL induced or procured Tanmari's purported termination of the 2004 Agreement; whether FIPL had sufficient knowledge of the terms of the 2004 Agreement to know it was a breach; and whether FIPL had the intention for the Tanmari to breach the 2004 Agreement or was recklessly indifferent or wilfully blind to the breach. 299The Plaintiffs submit that Tanmari purported to terminate the 2004 Agreement where it had no right to do so and thereby repudiated and committed an anticipatory breach of that agreement. I accept that the purported termination of that agreement was arguably an anticipatory breach of it and may have amounted to a repudiation of it, subject to the qualification that it is by no means clear that Tanmari (or FIPL on its behalf) would not comply with that agreement if the Court held that termination was invalid. I accept that FIPL induced or procured Tanmari's attempted termination of the 2004 Agreement. Mr Taylor's evidence was that he "directed" Tanmari to send the letter giving HSFS notice of breach of that agreement and the further letter terminating that agreement (Taylor 31.10.13 [84], [86]). The Plaintiffs refer to further evidence of FIPL's involvement, but it is not necessary to address that evidence to reach that conclusion. 300The Plaintiffs recognise that a further question then arises as to whether FIPL had sufficient knowledge of the terms of the 2004 Agreement to know that the purported termination of it was a breach of it. Mr Taylor accepted that he became aware of the terms of the 2004 Agreement after he received a copy of the letter dated 18 November 2011 from the Plaintiffs' solicitors to Tanmari (Taylor 31.10.13 [36]). The Plaintiffs submit, and it follows, that FIPL knew about Tanmari's right to terminate in cl 8, the dispute resolution process in cl 10 and notice provisions in cl 13 of that agreement. However, knowledge of the terms of an agreement is not the same as knowledge of breach of it, particularly in a complex factual setting. The Plaintiffs submit that FIPL intended for Tanmari to breach the 2004 Agreement or to interfere with Tanmari's performance of the contract, or alternatively, it was recklessly indifferent or willfully blind to Tanmari's breach and Tanmari's breach was an inevitable consequence of FIPL's direction that it terminate the contract. I do not accept that submission, where FIPL's and Tanmari's conduct is at least equally consistent with a belief that Tanmari had a right to terminate the 2004 Agreement in the relevant circumstances. 301As I noted above, damage is also a necessary element of the tort of inducing breach of contract. The Defendants submit, and I accept, that HSFS has not established that it suffered such damage, where HSFS had, as I have noted above, ceased to undertake business with new customers before the FIPL Purchase Agreement was made and that transaction did not affect HSFS's ability to license QSS to existing customers at the end of that seven-year period under the 2004 Agreement. Groundless threats of copyright infringement (Amended Statement of Claim [122] - [125]) (Plaintiffs' issues 59-60) 302The Plaintiffs also claim that the Defendants have made groundless threats of copyright infringement for the purposes of s 202 of the Copyright Act. The Plaintiffs identify the issues in respect of this claim as whether FIPL has threatened a person with action for infringement of copyright, by means of circulars, advertisements or otherwise. The Plaintiffs identify the relevant legal principles as that the relevant representations must be a threat to bring proceedings for infringement and not merely notification of the existence of copyright and that the threats do not have to be made directly to the person threatened, and may include threats made generally, for example through advertisements, or to a third party: South State Food & Beverage Pty Ltd v Kaur [2005] FCA 587. 303There is ultimately little contest that the relevant statements, if unjustifiable, would have contravened s 202 of the Copyright Act. In oral submissions, FIPL accepted (T42) that the relevant representations amounted to threats of an action for copyright infringement and submitted that it had now brought such an action and that the threats were not unjustified because that action was justified. FIPL properly accepted that, if there was no infringement of copyright, then it would follow that the making of those representations would constitute groundless threats of copyright infringement. This claim therefore depend upon the outcome of the Cross-Claimants' claim for copyright infringement. 304The Plaintiffs point to representations on a website registered to FrameCAD Ltd (Ex P2 394, Pacione 1.11.12 [14] Annex G, 65, 66) that its (or FIPL's) solicitors had written to a company, which would have been readily identifiable as HSFS or, more likely, SFSI; that it (or FIPL) believed that company's actions amounted to infringement of "our copyright" which it took "extremely seriously"; and that FIPL was warning their customers to avoid "disruption of service". The Plaintiffs submit that there was no copyright infringement where JRC owns or has a non-exclusive licence in QSS pursuant to the 2002 Agreement; JRC and HSFS have an implied licence in QSS; HSFS has a non-exclusive licence in QSS pursuant to the 2004 Agreement; and SFSI has a right to use QSS because JRC granted rights to SFSI using JRC's rights in the 2002 Agreement. I have addressed these submission in respect of the corresponding claim for misleading or deceptive conduct in respect of the representations on the website in paragraphs 260-268 above. A copyright infringement by SFSI is established for the reasons noted below and the threat of action for infringement was not unjustified. 305The Plaintiffs also point to the position taken in an email dated 21 December 2011 from Mr Taylor to a third party (Ex P2, 371; Pacione 19.3.14 [108] JP4-M) that a "court battle [is] looming". The Plaintiffs submit that FIPL made that representation before Tanmari purported to terminate the 2004 Agreement on 24 January 2012, and that the 2004 Agreement granted (I interpolate, subject to the issues arising in respect of the seven-year period specified in cl 2.2 to which I referred above) HSFS the right to use QSS. That does not seem to me to assist the Plaintiffs where the relevant representation was not specifically directed to HSFS, but to the position in respect of infringing use; the relevant use was by SFSI, since HSFS had ceased to deal with new customers and had substantially or entirely ceased its business from April 2009; and a copyright infringement by SFSI is established for the reasons noted below and the threat of action for infringement was not unjustified. Cross-Claim by FIPL and Tanmari 306FIPL and Tanmari also bring a Cross-Claim against JRC, HSFS, SFSI and Mr Pacione for breach of copyright, breach of trade mark, misuse of confidential information and misleading or deceptive conduct. Mr Pacione accepts that he is the controlling mind of JRC, HSFS since September 2008 and SFSI. The Cross-Defendants complain that these complaints were not raised until after Mr Cummings and Tanmari sold QSS to FIPL. It seems to me that that complaint is a distraction from the underlying question of whether the claims made by the Cross-Claimants are justified. The Cross-Defendants identified a list of issues arising in respect of the Cross-Claim which is again elaborate, and again of assistance in identifying the matters to be determined in the proceedings. I will refer to those issues in addressing particular questions below, although I have rephrased them on several occasions for simplicity, and have dealt with issues that raise common questions together. Copyright (Cross-Claim [1] - [17]) (Cross-Defendants' issues 1-4) 307Paragraphs 1-17 of the Cross-Claim raise issues as to whether copyright subsists in each update or new release of QSS; whether FIPL owns copyright in QSS releases to 1 November 2011 and after that date; and whether copyright subsists in each update and new release of user documentation. It is common ground that QSS is a computer program and a "literary work" as defined in s 10 of the Copyright Act. 308The first issue is whether copyright subsists in each update or new release of QSS. A preliminary question arises as to whether HSFS and JRC have admitted that matter by the pleadings in the proceedings. Paragraph 7 of the Plaintiffs' Amended Statement of Claim (to which JRC and HSFS are party, but Mr Pacione and SFSI are not) pleads that copyright subsists in the QSS Application (as defined). Paragraph 7(b) of the Amended Statement of Claim in turn pleads that Mr Cummings would be the owner of copyright in any updates to the QSS Application when the copyright came into existence. The Cross-Defendants submit, and I accept with some hesitation, that that pleading deals with the position as to ownership of copyright, if such copyright exists (or at the highest, assumes that such copyright exists) in such updates and does not concede that such copyright exists. The Cross-Defendants also point out that paragraph 7(b) of the Amended Statement of Claim deals only with updates and is not an admission in relation to new releases of software, where the terms "updates" and "new releases" are separately defined in the 2004 Agreement as noted above. 309Paragraph 2 of the Cross-Claim in turn pleads that Mr Cummings "from time to time" made updates and new releases of the QSS software. The Cross-Defendants admit that paragraph (Defence to Cross-Claim [2]). They point out that these pleadings do not necessarily extend to all updates and new releases of the software, given the qualification introduced by the term "from time to time", which introduces uncertainty as to whether the claim is that Mr Cummings developed all user documentation or only developed it from time to time, leaving open the possibility that other persons also did develop user documentation. In paragraphs 3-4 of the Defence to Cross-Claim, the Cross-Defendants "do not admit" that each update or new release of QSS contained reproductions of the whole or a substantial part of the previous version and say that some of the updates or new versions deleted or amended material and some of the additional, deleted or amended material was not original, and deny that each update or new release was a new literary work being a computer program in which copyright subsists, and say that each update was not substantial enough or original enough to be a new literary work. 310On balance, and with some hesitation, it seems to me that it is open to the Cross-Defendants, given these pleadings, to place in issue whether copyright subsists in each update or new release of QSS. That issue is at least open to SFSI and Mr Pacione which are not bound by any pleading in that respect in the Amended Statement of Claim filed by JRC and HSFS. 311The Cross-Claimants submit that each new version of QSS includes previous versions of the software but with additional material and is a new work in which copyright subsists and they point to the minimal extent of the changes to a work necessary to establish a new copyright work: Interlego AG v Croner Trading Pty Ltd (1992) 39 FCR 348; 111 ALR 577. The Cross-Defendants respond that, where the Cross-Claimants seek a declaration and injunctive relief in respect of each update or new release, then they must prove that copyright subsists in each update or new release. I accept that submission, both as a matter of principle and because the decision in Cummings v Vella [2002] FCAFC 218 seems to me to be authority that, unsurprisingly, that conclusion cannot be reached by taking a sample of some updates and releases and not considering the position as to others. However, it does not follow that such a conclusion can only be reached by individual scrutiny of the content of several hundred releases and updates. It may, in principle, be reached by inferences properly drawn from evidence as to the nature of such updates and releases and the process by which they were prepared. 312The Cross-Defendants submit that an inference that each update or new release was sufficiently substantial or original to support a claim to copyright cannot be drawn, because the changes between an update or release and a subsequent update may not be sufficiently "original" or sufficiently substantial so as to constitute a new literary work, and that it is necessary to demonstrate "some intellectual effort" in relation to each such update or release. They point to the observation of Lord Atkinson in Macmillan & Co Ltd v Cooper (1923) 40 TLR 186 at 188 that: "To secure copyright for this product it is necessary that labour, skill and capital should be expended sufficiently to impart to the product some quality or character which the raw material did not possess, and which differentiates the product from the raw material." That observation was in turn cited in Interlego AG v Tyco Industries Inc [1989] 1 AC 217, where Lord Oliver observed (at 263) that: "There must in addition be some element of material alteration or embellishment which suffices to make the totality of the work an original work. Of course, even a relatively small alteration or addition quantitatively may, if material, suffice to convert that which is substantially copied from an earlier work into an original work. Whether it does so or not is a question of degree having regard to the quality rather than the quantity of the addition." The Cross-Defendants also refer to Telmak Teleproducts (Aust) Pty Ltd v Bond International Pty Ltd (1985) 66 ALR 118; 5 IPR 203 and CBS Records Australia Ltd v Gross (1989) 15 IPR 385, which seem to me to be examples of the application of that principle in particular cases. 313In IceTV Pty Ltd v Nine Network Australia Pty Ltd [2009] HCA 14; (2009) 239 CLR 458, French CJ, Crennan and Kiefel JJ observed (at [33]) (footnotes omitted) that: "The requirement for copyright subsistence that a literary work be "original" was first introduced into the Copyright Act 1911 (Imp), although it had already been recognised at common law. Originality for this purpose requires that the literary work in question originated with the author and that it was not merely copied from another work. It is the author or joint authors who bring into existence the work protected by the Act. In that context, originality means that the creation (ie the production) of the work required some independent intellectual effort, but neither literary merit nor novelty or inventiveness as required in patent law." Their Honours also observed (at [47] - [48]) that: "Much has been written about differing standards of originality in the context of the degree or kind of "skill and labour" said to be required before a work can be considered an "original" work in which copyright will subsist. "Industrious collection" or "sweat of the brow", on the one hand, and "creativity", on the other, have been treated as antinomies in some sort of mutually exclusive relationship in the mental processes of an author or joint authors. They are, however, kindred aspects of a mental process which produces an object, a literary work, a particular form of expression which copyright protects. A complex compilation or a narrative history will almost certainly require considerable skill and labour, which involve both "industrious collection" and "creativity", in the sense of requiring original productive thought to produce the expression, including selection and arrangement, of the material. It may be that too much has been made, in the context of subsistence, of the kind of skill and labour which must be expended by an author for a work to be an "original" work. The requirement of the Act is only that the work originates with an author or joint authors from some independent intellectual effort. Be that as it may, as noted previously, since the subsistence of copyright need not be considered in this appeal, the relevance of skill and labour to that inquiry need not be considered further." I accept that the majority there refer to the need for independent intellectual effort in order to establish originality, but they also note that originality requires that the work originate with the author and distinguish the mere copying of another work, and recognise that a complex compilation may itself involve creativity and original thought. A pure compilation may well not satisfy that standard, but that result need not follow for updates to computer software which involve significant time and effort. Gummow, Hayne and Heydon JJ also there emphasised (at [131]) the need to have regard to the particular form of expression of information and pointed out that the Copyright Act does not afford protection to skill and labour alone. 314There is substantial evidence to support Mr Cummings' and Tanmari's claim to originality in QSS and the updates and new releases to it, and to copyright in QSS and those updates and new releases. I have referred above to Mr Cummings' and Mr Pacione's evidence of the extent of updates to QSS during the relevant period. Mr Cummings' evidence is that he developed QSS (Cummings 4.12.12 [3]) and that he was the sole author of all source code for QSS (Cummings 14.10.13 [37]). In 2002 - 2004, Mr Cummings made significant changes to QSS (Cummings 4.12.12, [27]-[31]; Cummings 14.10.13 [100]ff) including rewriting it to achieve compatibility with IntelliCAD; rewriting parts of QSS in the C++ programming language which is machine-readable to allow calculations to be performed more quickly; and developing the look-up tables using engineering principles and reducing the number of lines of source code in QSS. In the period between 1990 and November 2011, Mr Cummings developed and released more than 500 versions of QSS and created end user manuals and other documentation (Cummings 4.12.12 [32]). The release notes of QSS, which are in evidence for versions 11.176 to 11.399 from prior to November 2002 up to 20 May 2005 (Cummings 3.12.12 Ex D6, 215-267), versions 11.209 to 11.533 from 29 October 2002 to 8 March 2008 (Pacione 26.10.12 [27], Ex P7, 3/60-131) and versions 11.400 to 11.605 from 9 June 2005 to 20 September 2011 (Cummings Ex D6, 267-302) indicate the extent of the additional work performed by Mr Cummings in making each new version of QSS. Mr Cummings' evidence also indicates the extent to which the source code of QSS has increased over that period, from 23,275 lines in version 11.176 (dated prior to February 2002) to 170,062 lines in version 11.406 (prepared in program language C++ in August 2005) and then to 297,954 lines in version 11.604 (prepared in program language C++ in May 2011) (Cummings 14.10.13 [106]). Mr Cummings' evidence is also that he devoted approximately 40 plus hours per week on writing source code for QSS from 2002 to November 2011 (Cummings 14.10.13 [110]). 315The Cross-Defendants submit that Mr Cummings does not give "sufficient evidence" about the process of writing the code, including whether he directly wrote every line of code, or whether he used script editors or other software tools and these tools and programs generated the code, or whether he used commonplace routines in the code. They also point out that he accepted in cross-examination that he used software tools to generate part of the code, but I understand that acceptance to go no further than the use of tools available within the "C++ development environment" (T328). The Cross-Defendants also submit that Mr Cummings' evidence as to lines of code (Cummings 14.10.12 [106]) is "just a counting exercise" and that there is no analysis of the quality of the code or the files, whether there is a change in the functionality, or logic or structure, of the code or the files or the program in general and points out that the lines of code counted include CNC or data files that are not part of the literary work that is the computer program. They also submit that some of the updates and new releases "may have been" derivative works from other third party works, and there "may be" insufficient originality to constitute a separate work from the other third party works. It seems to me, with respect, that that this submission is no more than speculation. Next, the Cross-Defendants suggest that there "may be" no human author of the update or new release, and point out that copyright will not subsist if the work is computer generated: Telstra Corporation Ltd v Phone Directories Company Pty Ltd [2010] FCAFC 149; (2010) 194 FCR 142 at [117]-[119] per Perram J. I accept that copyright would not be established in updates or new releases that were wholly computer-generated, but the evidence and particularly Mr Cummings' evidence provides no support for a conclusion that the updates or new releases were prepared in that way. 316The Cross-Claimants also rely on admissions as to the copyright of Mr Cummings and Tanmari in Recital A of the 2002 Agreement; Recital A and cl 7.1(e) of the Exclusivity Agreement; Recital A and cl 7.1(e) (warranty) of the 2004 Agreement; cl 7.1 of the Stramit August 2004 software Development Agreement between HSFS and Tanmari; and cl 7.1 of the BNBM 2005 Software Development Agreement between HSFS and Tanmari, to which I have referred above. The Cross-Claimants submit that each of the admissions was made by Mr Pacione on behalf of each of JRC and HSFS and that those admissions are against interest. However, it does not seem to me that those admissions can be treated as binding on SFSI and Mr Pacione, for the purposes of the Cross-Claim. 317I have not accepted several of the Cross-Defendants' submissions above, and it must be recognised that JRC and HSFS propound, as part of their case as Plaintiffs, Mr Cummings' ownership of copyright in QSS and that is not a matter they can now impugn. Nonetheless, the evidence led by the Cross-Claimants does not allow me to determine whether any particular update (other than the three updates to which I refer below) or all updates was original in the relevant sense, although it suggests that many such updates are likely to have that character given the time and work that went into their development. The conclusion that a group of items collectively involved significant effort, and were the original work of an author, does not indicate that every item in that group has that character, where republication of earlier versions with, for example, minor corrections that would not be original in the relevant sense, is by no means implausible. I therefore cannot grant a declaration or other relief extending to every new release and update of QSS. I do accept, however, that the evidence of the substantial time and effort spent by Mr Cummings and the significant increase in the number of lines in the software over time is sufficient to establish that the three identified versions of QSS which were the subject of line counts are subject to a proper claim for copyright and a declaration should be made in respect of those versions. 318The second issue identified by the Cross-Defendants is, if copyright subsists in QSS, whether FIPL owns copyright in all QSS releases to 1 November 2011. The formulation of this issue requires one immediate correction. The fact that such copyright exists is pleaded by JRC and HSFS and that pleading amounts to an admission against interest by which they are bound. That is the case notwithstanding they have not admitted the position in respect of each new release and update forming part of the application. The evidence to which I have referred above is sufficient to establish that copyright subsists in QSS, so far as Mr Pacione and SFSI may not have been bound by those admissions. 319The Cross-Defendants contend that FIPL is not the sole owner of the copyright in all QSS releases to 1 November 2011. They contend that Mr Cummings assigned the copyright in QSS to JRC under the 2002 Agreement, and that included an assignment of copyright as at 28 July 2002 under s 196(2) of the Copyright Act and an assignment of future copyright to the extent that copyright subsisted in subsequent updates and new releases under s 197 of the Copyright Act and JRC is therefore one of the owners of QSS. I do not accept that proposition since I have held above that the 2002 Agreement did not effect an assignment of the copyright in QSS to JRC. The Cross-Defendants also contend that Tanmari's claim to copyright does not detract from Mr Cummings' assignment of copyright to JRC because Mr Cummings did not assign any rights to Tanmari and was never Tanmari's employer so ss 35(6) and 196 of the Copyright Act do not apply. This question does not arise in this context since I have held that the 2002 Agreement did not effect an assignment of the copyright in QSS to JRC, although I have addressed associated issues above. The Cross-Defendants also contend that Mr Cummings' assignment to FIPL in the FIPL Purchase Agreement is subject to JRC's ownership of the copyright in QSS, since Mr Cummings cannot assign to FIPL what he already assigned to JRC. The premise of this proposition, namely, the assignment of copyright to JRC, is not established for the reasons noted above. 320The third issue identified by the Cross-Defendants is whether FIPL owns copyright in all QSS releases after 1 November 2011. The Cross-Defendants contend that FIPL has not demonstrated that it owns copyright in all releases after 1 November 2011. They point to Mr Taylor's evidence that, from May 2013 to October 2013, FIPL worked on developing improved software to be compatible with IntelliCAD version 6.6 (Taylor 30.5.14 [8]). They also point to Mr Cummings' evidence that he is not involved in developing QSS to be compatible with IntelliCAD (T264) and to Mr Taylor's evidence that persons other than Mr Bilkey and Mr Cummings have been involved in the current development of QSS (T376). The Cross-Defendants contend that there is otherwise no evidence of who did the work or whether they are qualified persons for the purposes of the Copyright Act; no evidence of the originality or substantiality of their work (which raises a similar issue to that addressed in paragraphs 310-316 above) and no evidence that FIPL owns the rights in this work. 321The Cross-Defendants refer to Fairfax Media Publications Pty Ltd v Reed International Books Australia Pty Ltd [2010] FCA 984; (2010) 189 FCR 109, where the plaintiff had not identified the authors of newspaper headlines and combinations of newspaper article and headline and Bennett J held that a presumption of anonymous authorship under s 129 of the Copyright Act was not available and observed (at [79]-[82]) that: "I am not satisfied that the presumption of anonymous authorship is available. Fairfax has pleaded that the works in suit were written by its employees and were created only around twelve months prior to the hearing. Fairfax has chosen not to identify the authors. The onus does not shift to Reed to identify those authors, failing which Fairfax will be entitled to the benefit of a presumption that its works are original. There are no additional words in s 129(2) that provide that the test becomes whether the identity of the author can be ascertained by reasonable inquiry "external to the author or their employer. Section 129(2) of the Act applies where the "publication was anonymous or is alleged by the plaintiff to have been pseudonymous". Fairfax submits that the onus of establishing that the identity of the author is not generally known or cannot be ascertained by reasonable inquiry falls on the person challenging that anonymity and not on the person alleging it. I do not accept that submission as a matter of construction or as a matter of common sense. Authorship is crucial for establishing copyright because it is essential to prove that the work originated from an author who expended independent intellectual effort to create the expression in the work (IceTV at [48]). Section 129(2) assists the person claiming copyright where the identity of the author cannot be ascertained because it would otherwise be impossible to prove that the work originated from an unidentified author. The section cannot be intended to be address the situation where the source of the work and the authors are evident to or available to be ascertained by the employer but the employer claiming copyright decides not to identify the precise authors." I accept that a presumption under s 129 of the Copyright Act is not available where FIPL could have, but did not, lead evidence to establish the authors of new releases and updates to QSS since November 2011, and that those persons were in a relationship with it such that it held the relevant copyright. For these reasons, I accept that it is not been established that each of the updates and new releases of QSS since 1 November 2011 constitutes copyright works and that FIPL owns all updates and new releases of QSS since that date. However, little may turn on this matter where JRC and HSFS admit that copyright subsists in QSS and I have rejected the proposition that they have any interest in that copyright. 322For completeness, I note that the Cross-Defendants also contend that a consultant, Mr Bilkey, worked on the source code for QSS after 2011, subject to an agreement with FrameCAD Ltd rather than FIPL (Ex P2 383a.) They submit that some of his development work "may still" be part of updates and new releases of QSS and that there is no evidence that FIPL owns Mr Bilkey's work, to the extent that his work is part of any of the updates or new versions of QSS. It seems to me that a proposition that FIPL did not own copyright in QSS after November 2011 because Mr Bilkey or FrameCAD Ltd did so, at least in part, is a matter that would need to have been pleaded, to give the Cross-Claimants notice of it and an opportunity to lead evidence in response. It is now open to the Cross-Defendants in the absence of such a pleading. 323The fourth issue identified by the Cross-Defendants is whether copyright subsists in each end user manual and other documentation ("user documentation") for QSS. Paragraph 2 of the Cross-Claim pleads that, "from time to time", Mr Cummings made updates and new releases of user documentation. The Cross-Defendants admit this paragraph (Defence to Cross-Claim [2]). The Cross-Defendants point out that these pleadings do not necessarily extend to all user documentation, given the qualification introduced by the term "from time to time", which introduces an ambiguity (similar to that which I have noted above in respect of updates and new release of QSS software) as to whether the claim is that Mr Cummings developed all user documentation or that he only developed it on an occasional basis. Mr Cummings gives limited evidence about the creation and evolution of user documentation (Cummings 14.3.13 [111]) and no evidence as to separate updates or new releases of the user documentation. It has not been established that there is sufficient originality to establish copyright in each update or new release of the user documentation. 2002 Agreement (Cross-Claim [18] - [21]) (Cross-Defendants' issue 5) 324Paragraphs 18-21 of the Cross-Claim raise an issue whether the 2002 Agreement was completed, superseded and terminated as at August 2004. I have addressed that question in respect of the primary claim and held that the parties had abandoned that agreement by that date. Has HSFS purported to grant a sub-licence of its rights under the 2004 Agreement to SFSI (Cross-Claim [28], [29], [32]) (Cross-Defendants' issue 6) 325Paragraphs 28-29 and 32 of the Cross-Claim raise an issue whether HSFS purported to license the right to licence the use of QSS, know-how methodology and trade secrets under the 2004 Agreement to SFSI. The Plaintiffs and Cross-Defendants did not contend that such a licence had been granted. They relied exclusively on the sub-license of rights under the 2002 Agreement said to have been granted by JRC (by Mr Pacione) to SFSI (by Mr Pacione) in April 2009. The case has therefore been conducted on the common basis that no such licence of rights under the 2004 Agreement was granted by HSFS to SFSI. Purported licence by JRC under the 2004 Agreement (Cross-Claim [30], [33] - [37]) (Cross-Defendants' issues 7-9) 326Paragraphs 30 and 33-37 of the Cross-Claim raise an issue whether JRC purported to licence SFSI to use and sub-license the use of QSS and whether HSFS knew and consented to JRC purporting to license SFSI to use and sub-license QSS, and whether that knowledge and consent was a breach of the 2004 Agreement. In dealing with the Plaintiffs' claim which relied on such a sub-licence, I indicated that I am not satisfied that an sub-licence was effectively granted by JRC to SFSI in April 2009 in reliance on its rights under the 2002 Agreement, or that the terms of any such grant (which were not identified by the Plaintiffs) were sufficient to authorise SFSI's sub-licensing QSS to third parties after that date. 327It is convenient to deal with the eighth and ninth issues identified by the Cross-Defendants together, namely, whether HSFS knew and consented to JRC purporting to license SFSI to use and sub-license the use of QSS and whether, if HSFS knew and consented to JRC purporting to license SFSI, this was a breach of the 2004 Agreement. On the findings that I have reached, these questions do not arise, since it has not been established that the relevant sub-licence was granted by JRC (by Mr Pacione) to SFSI (by Mr Pacione) in April 2009 and the Cross-Defendants have not contended a that sub-licence was granted at any later date. Had this issue arisen, I would have held that HSFS would have had knowledge of any step taken by JRC in that regard. The contrary position would be wholly unrealistic where Mr Pacione was the controlling director of each of the companies and HSFS is unlikely to have abandoned its business of dealing with new customers without knowledge that SFSI would deal with those customers in its place and of the basis on which it would do so. The Cross-Defendants submit, and I accept, that "consent" on the part of HSFS would have required a positive act of agreement, permission or assent. However, it seems to me that the abandonment by HSFS of its business in favour of SFSI would have been sufficient to amount to such consent. I would not have accepted the Cross-Defendants' further submission that there is no evidence that HSFS "was in any way involved" with the grant of any such sub-licence or that JRC's granting rights to SFSI had "nothing to do with" HSFS. HSFS had least had an involvement in the matter so far as it ceased its business of dealing with new customers so as to permit SFSI to do so in its place. 328The Cross-Defendants respond to the claim that HSFS's knowledge and consent to SFSI's conduct amounted to a breach of the 2004 Agreement by observing that there are no express terms prohibiting HSFS from knowing and consenting to JRC purporting to license SFSI and the Cross-Claimants have not otherwise pleaded why HSFS's knowledge and consent to JRC purporting to license SFSI is a breach of the 2004 Agreement. I accept those submissions. That conduct may or may not have breached a duty of good faith or an implied duty of cooperation or a narrower duty of HSFS not to act in a manner that would deprive Tanmari of the benefit of licence fees under that contract. However, a claim on that basis was not pleaded by the Cross-Claimants and it would not be appropriate to address it where it was not squarely raised so as to allow the Cross-Defendants to respond to it. HSFS's failure to pay licence fees under the 2004 Agreement (Cross-Claim [38] - [48]) (Cross-Defendants issues 10-12) 329Paragraphs 38-48 of the Cross-Claim raise issues whether HSFS has paid all licence fees for licences granted by it on a "per person" basis; whether HSFS is required to pay licence fees for licences granted by SFSI; and whether any failure to do so entitles Tanmari to terminate the 2004 Agreement. 330The tenth issue identified by the Cross-Defendants is whether HSFS paid all licence fees for all licences granted by SHFS on a "per person" basis. As I noted above in dealing with this issue in respect of the termination of the 2004 Agreement, the Cross-Defendants contend that HSFS paid all outstanding licence fees on 6 January 2012 when it paid the Paintiffs' solicitors $20,900 in respect of 19 licences (Ex P2 373). As I also noted above, the Cross-Claimants did not identify any evidence that any such fees were due and not paid, in respect of licences granted by HSFS as distinct from SFSI, when I invited supplementary submissions as to the matter and that proposition has therefore not been established. 331The eleventh issue identified by the Cross-Defendants, and the real issue in dispute in this regard, is whether HSFS is required to pay licence fees for licences granted by SFSI. The Cross-Defendants contend that HSFS is not liable to pay licence fees under the 2004 Agreement for licences granted by SFSI because SFSI is not exercising rights under the 2004 Agreement, but (they contend) under the 2002 Agreement. As I noted above, the Cross-Claimants in turn plead that SFSI has exercised copyright without the copyright owner's licence since at least April 2009 (Cross-Claim [60]) and that claim is consistent with that characterisation of events. The twelfth issue identified by the Cross-Defendants is whether HSFS's failure to pay licence fees under the 2004 Agreement is a breach that would entitle Tanmari to terminate the 2004 Agreement. The Cross-Defendants respond that there is no evidence that HSFS failed to pay licence fees; HSFS was not required to pay licence fees for licences granted by any other party; and, as of 24 January 2012, there was no entitlement to terminate the 2004 Agreement. 332I have addressed these questions above in dealing with the termination of the 2004 Agreement. This claim has not been established since SFSI's conduct, although in breach of copyright, did not involve the grant of licences by HSFS so as to give rise to a liability to pay licence fees under the 2004 Agreement. Termination of the 2004 Agreement (Cross-Claim [49] - [50]) (Cross-Defendants' issue 13) 333Paragraphs 49-50 of the Cross-Claim raise the question whether Tanmari terminated the 2004 Agreement. I have addressed this issue above in dealing with the Plaintiffs' claim and held that the 2004 Agreement was not validly terminated. Constructive trust (Cross-Claim [51] - ]54]) (Cross-Defendants' issues 14 - 16) 334The fourteenth issue identified by the Cross-Defendants is whether a constructive trust remedy is available for a contractual debt claim. The Cross-Claimants plead that HSFS holds licence fees in the amount set out in August 2004 on constructive trust for Tanmari (Cross-Claim [51]) or alternatively SFSI holds the licence fees on constructive trust for Tanmari (Cross-Claim [52]) or alternatively JRC holds the licence fees on constructive trust for Tanmari (Cross-Claim [53]) and Tanmari holds the unpaid licence fees on constructive trust for FIPL (Cross-Claim [54]). This issue does not arise since a right to such licence fees under the 2004 Agreement has not been established in respect of sub-licences granted by SFSI. The Cross-Defendants also submit, and I accept, that, absent a claim for breach of fiduciary duty or breach of trust, a constructive trust was not in any event an available or appropriate remedy in respect of a contractual claim against HSFS for unpaid licence fees based on the 2004 Agreement: Daly v Sydney Stock Exchange Ltd [1986] HCA 25; (1986) 160 CLR 371. 335The fifteenth and sixteenth issues identified by the Cross-Defendants is whether the unpaid licence fees payable by HSFS under the 2004 Agreement are presently existing property and whether FIPL is the owner of the unpaid licence fees payable by HSFS under the 2004 Agreement, so that only it and not the Cross-Defendants might hold that property on trust. These issues do not arise because I have held that no such licence fees are payable. Copyright infringement (Cross-Claim [56] - [66]) (Cross-Defendants issues 17-21) 336The Cross-Defendants identify the issues in respect of this claim as whether SFSI has infringed copyright; whether HSFS authorised any such infringement of copyright; whether JRC authorised SFSI's exercise of copyright; whether Mr Pacione authorised SFSI to infringe copyright; and whether Mr Pacione authorised JRC or HSFS to authorise SFSI's exercise of copyright. 337Paragraphs 58-59 of the Cross-Claim plead infringements of copyright by HSFS and JRC respectively. Paragraph 60 of the Cross-Claim pleads that SFSI has exercised copyright rights in QSS and user documentation without the copyright owner's licence since at least April 2009. The Cross-Claimants contend that the essence of their claim for copyright infringement is that the Cross-Defendants have reproduced or authorised the reproduction of QSS; communicated QSS to the public by making it available online or authorised that communication, by their conduct in providing QSS under licence to their customers for use by their customers in making steel framing systems. 338The Cross-Claimants contend that the only issue in dispute is whether the conduct was engaged in "without the licence of the copyright owner" for the purposes of ss 15, 36(1) and 115 of the Copyright Act. The Cross-Claimants accept that they bear the onus to establish the lack of a licence as an element of the action for copyright infringement: Avel Pty Ltd v Multicoin Amusements Pty Ltd above. They rely, relevantly, on the termination of the 2004 Agreement and any licence granted under it in 2011; that SFSI was not a customer of HSFS and its purported use of QSS was not for "internal business purposes only" in accordance with the 2004 Agreement; and that FIPL has not authorised the conduct or, alternatively, FIPL is not bound by any licence granted to JRC or HSFS. The Cross-Claimants submit that their claim for infringement of copyright will largely depend upon the determination of the contractual issues, including the construction of the 2002 Agreement and the 2004 Agreement. As events developed in the hearing, it is not necessary to address the issue in respect of the 2004 Agreement because the Cross-Defendants do not contend that SFSI derived any authority to use or sub-license QSS from HSFS under that agreement, as distinct from deriving that authority from JRC under the 2002 Agreement. 339The Cross-Claimants contend that the Cross-Defendants have reproduced or authorised the reproduction of QSS and communicated QSS to the public (by making it available online) or authorised the communication, by their conduct in providing QSS under licence to their customers for the purpose of use by their customers in making light gauge steel framing systems. There is no dispute that the Cross-Defendants' software (previously known as HayesCAD, now known as ProCAD) is the same as QSS. There is also no dispute that SFSI has engaged in that conduct since about 2009 and has continued to exploit the software by making it available to its customers after the date of FIPL's acquisition in November 2011 and intends to continue this conduct. The Cross-Defendants accept that HSFS also engaged in that conduct on at least one occasion after 2009 (Ex D4). 340The Cross-Defendants submit that SFSI has not infringed copyright, because JRC granted SFSI a right to use QSS using JRC's rights under the 2002 Agreement. I do not accept that submission. As I noted above, the 2002 Agreement had been abandoned by the parties well before April 2009; I am not satisfied that JRC effectively granted the suggested sub-licence to SFSI in April 2009 for the reasons I have indicated above in respect of the primary claim; and the Plaintiffs do not contend that the rights were conferred on SFSI in any other way, for example, by HSFS under the 2004 Agreement (which would have given rise to an obligation to pay licence fees that were not paid) or by JRC at any later date. 341The Cross-Defendants also submit that, even if SFSI exercised copyright in QSS, the Cross-Claimants can only establish infringement by identifying the particular copyright work of Tanmari or FIPL and identifying a particular work of SFSI that reproduces the whole or a substantial part of the particular copyright work, and that the Court is not permitted to take a representative sample and infer infringement: Cummings v Vella above at [34]-[38]. I accept that the Court cannot find copyright infringement based on a representative sample. However, it seems to me that SFSI's alleged infringement of the copyright in QSS is established by the matters that are admitted by JRC and HSFS and the findings that I have reached above. JRC and HSFS themselves plead that Mr Cummings has copyright in QSS and it is common ground that he assigned that copyright to FIPL by the FIPL Purchase Agreement; so far as SFSI is not bound by that admission, the evidence to which I have referred above established that Mr Cummings had copyright in at least three specific versions of QSS to which I have referred; and it is also common ground that SFSI has sub-licensed the use of QSS to third parties since April 2009 relying on the purported sub-licence to it by JRC of its rights under the 2002 Agreement; and I have held that JRC did not confer those rights on SFSI for the reasons noted above. This finding does not involve the Court taking any "representative sample" and inferring infringement, since the admission by JRC and HSFS and my findings as to ownership of the copyright in the three specific versions of QSS are sufficiently wide that any unauthorised use of that copyright by SFSI gives rise to infringement. 342The Cross-Defendants also point out that the Cross-Claimants claim that each update or new release of QSS and user documentation is a new and literary work (Cross-Claim [4] and [6]) and contend that they have not pleaded or identified which copyright work, which update or new release of QSS and user documentation that SFSI has infringed. It seems to me that submission does not assist the Cross-Claimants. Where it is admitted by JRC and HSFS that Mr Cummings had copyright in QSS and established as against SFSI that Mr Cummings had copyright in the three specific versions of it to which I referred above, and not established that SFSI had any right to use QSS, then the Cross-Claimants can establish the breach of copyright by showing SFSI's use of QSS, without needing to identify (at least at the liability, as distinct from quantification, stage) the particular updates or releases as to QSS as to which infringement took place. The evidence as to the manner in which QSS was developed and updated, to which I have referred above, supports a finding that any sub-licensing of QSS to that party since April 2009 will have involved reproducing one ore more of those versions of QSS (or subsequent releases that incorporated them) or communicating them to the public or authorising those acts. 343The next issue identified by the Cross-Defendants is whether HSFS authorised SFSI's infringement of copyright. The Cross-Defendants point out that, unsurprisingly, a person is only liable for authorising copyright infringement if there is copyright infringement: National Rugby League Investments Pty Ltd v Singtel Optus Pty Ltd [2012] FCAFC 59; (2012) 201 FCR 147. They contend that HSFS is not liable for authorising SFSI's infringement of copyright because SFSI did not infringe copyright. I have held to the contrary above. 344The Cross-Defendants also submit that, even if SFSI infringed copyright, this had "nothing to do with" HSFS. They point to s 36(1A) of the Copyright Act which provides that, in determining whether a person has authorised another person's infringement of a literary work such as a computer program, the Court must consider the extent (if any) of the person's power to prevent the doing of the act concerned; the nature of any relationship existing between the person and the person who did the act concerned; whether the person took any reasonable steps to prevent or avoid the doing of the act, including whether the person complied with any relevant industry codes of practice. They also draw attention to Roadshow Films Pty Ltd v iiNet Ltd [2012] HCA 16; (2012) 248 CLR 42, where French CJ, Crennan and Kiefel JJ observed at [68] that authorisation must be determined in light of these three factors rather than any other formulations of "authorisation" and (at [69]) that an alleged authoriser must have a power to prevent the primary infringements. Gummow and Hayne JJ also observed (at [142]-[143]) that indifference and countenancing infringement were not sufficient for authorisation. The Cross-Defendants submit that HSFS had no power to prevent SFSI exercising copyright; that it is not sufficient that HSFS and SFSI had a common director; and that HSFS had no contractual relationship with SFSI, let alone a contractual relationship that would allow it to control SFSI's activities. 345It seems to me that HSFS had at least a practical power to prevent the infringing conduct by SFSI, so far as that conduct was enabled by the fact that HSFS ceased doing business with new clients and thereby permitted SFSI, in effect, to assume its business; there was a close relationship between HSFS and SFSI, by the fact that Mr Pacione controlled and had the substantial economic interest in each of them, and by their cooperation in the transfer of HSFS's business to SFSI; and that HSFI took no steps to prevent or avoid the doing of the act, which could have included at least withholding its cooperation by not ceding its business to SFSI. These matters seem to me to be sufficient to establish that HSFS authorised the relevant conduct for the purposes of s 36(1A) of the Copyright Act. 346The next issue identified by the Cross-Defendants is whether JRC authorised SFSI's exercise of copyright. The Cross-Defendants submit that JRC is not liable for authorising SFSI's infringement of copyright because SFSI did not infringe copyright. I have held to the contrary above. The Cross-Defendants accept that, if SFSI infringed copyright, JRC is liable for authorising SFSI's infringement of copyright. The premise of that submission is plainly that JRC sub-licensed the rights to SFSI in April 2009 and I have not accepted that premise above. Consistent with my findings above, I am not satisfied that JRC authorised the relevant infringement. 347The next issue identified by the Cross-Defendants is whether Mr Pacione authorised SFSI's exercise of copyright. The Cross-Defendants contend that the evidence demonstrates that Mr Pacione is the person authorising the infringing conduct in each case. It is common ground that Mr Pacione is a director of SFSI, JRC and HSFS and the controlling mind of each company. The Cross-Claimants submit, plainly correctly, that a director of a company does not automatically authorise the company's copyright infringement: King v Milpurrurru (1996) 66 FCR 474 at 500; 136 ALR 327 per Beazley J (as per Honour then was). They point to authority that an individual director is only liable if the director did more than acting as a director, if he or she was personally involved, so that he or she directed, caused or procured the infringement, and that he or she made the tort his or her own: Keller v LED Technologies Pty Ltd [2010] FCAFC 55; (2010) 185 FCR 449. The parties otherwise made limited submissions as to this issue, which has generated significant controversy in the academic writings and the case law. 348A first basis for treating a director as liable for a company's breach of copyright is the "direct or procure" test, which was one of the bases on which a director could be held liable for a company's torts: Rainham Chemical Works Ltd (in liq) v Belvedere Fish Guano Co Ltd [1921] 2 AC 465; Performing Right Society Ltd v Ciryl Theatrical Syndicate Ltd [1924] 1 KB 1 at 14 per Atkin J; Wah Tat Bank Ltd v Chan Cheng Kum [1975] AC 507 at 514-515; 2 All ER 257 per Lord Salmon. In C Evans & Sons Ltd v Spritebrand Ltd [1985] 1 WLR 317; 2 All ER 415, that test was applied in determining whether a director was personally liable for an infringement of the plaintiff's copyright and Slade LJ summarised the position (at 323-324) as follows: "The mere fact that a person is a director of a limited liability company does not by itself render him liable for torts committed by the company during the period of his directorship ... Nevertheless, judicial dicta of high authority are to be found in English decisions which suggest that a director is liable for those tortious acts of his company which he has ordered or procured to be done." 349That decision was in treated as authority for the "direct or procure" test in Kalamazoo Australia Pty Ltd v Compact Business Systems Pty Ltd (1985) 84 FLR 101 at 127; 5 IPR 213 per Thomas J and in Australasian Performing Rights Association Ltd v Valamo Pty Ltd (1990) 18 IPR 216 at 220 per Davies J. A second formulation, which requires that a director "make the tort his own" is typically associated with Mentmore Manufacturing Co Ltd v National Merchandising Manufacturing Co Inc (1978) 89 DLR (3d) 195 and is more demanding than the "direct or procure" test: White Horse Distillers Ltd v Gregson Associates Ltd [1984] RPC 61 at 91-92 per Nourse J. In Microsoft Corp v Auschina Polaris Pty Ltd (1996) 71 FCR 231; 142 ALR 111, Lindgren J expressed the view (at 244-246) that the "direct or procure" test was more satisfactory than the "make the tort his own" test and that the predominance of Australian authority required him to follow it as he was not convinced that it was wrong. In King v Milpurrurru above, a majority (Jenkins and Lee JJ) appear to have adopted the "direct or procure" test, although Beazley J expressed a preference for the "make the tort his own" test. In Keller v LED Technologies Pty Ltd above, Emmett J formulated the test for liability in terms that did not expressly adopt either the "direct or procure" or "make the tort his own" test; Besanko J referred to the two tests but did not decide between them; and Jessup J expressed the view that a director would be liable if he or she stood apart from the company and procured the tort as a separate entity, using the company as an instrument of her or his own wrong and in that sense making the tort her or his own. The question of the applicable test was again left open in Young Investments Group Pty Ltd v Mann; [2012] FCAFC 107; (2012) 293 ALR 537 at [58]. 350It does not seem to me to be necessary to distinguish the tests, since Mr Pacione should be held liable for authorising SFSI's conduct on any of them. His actions in the present case were not merely undertaken as an officer of SFSI, in implementing a corporate action, but implementing an arrangement which he developed, and caused the companies to implement, by which HSFS's business was shifted to SFSI from April 2009 and SFSI continued to grant licences to QSS, where it had no rights to do so derived from Mr Cummings, Tanmari or HSFS and would not be required to pay licence fees to Tanmari under the 2004 Agreement. Mr Pacione was the sole controlling mind of the relevant companies and authorised and undertook each step involved in HSFS's ceasing business and SFSI assuming its business and granting sub-licences of QSS to its customers. It seems to me that, whichever test is adopted, Mr Pacione authorised SFSI's infringement of copyright. 351The next issue identified by the Cross-Defendants is whether Mr Pacione authorised JRC's or HSFS's authorising SFSI's infringement of copyright, although that issue might seem to reflect a degree of over-elaboration in the Cross-Claim. The Cross-Defendants submit that Mr Pacione is not liable for authorising JRC or HSFS authorising SFSI, even if SFSI is infringing copyright and even if JRC or HSFS authorised the infringement. It is not necessary to address the position as to JRC further since I have held above that it did not authorise the relevant infringement and no question of Mr Pacione authorising it to do so can arise. So far as HSFS is concerned, the Cross-Defendants submit that a person can only be liable for authorising copyright infringement if the person authorises the primary infringement. They contend that proposition is implicit in the requirement that the Court must, as noted above, take into account the person's power to prevent the act, the relationship with the person who did the act and whether the person took reasonable steps to prevent the act under s 36(1A) of the Copyright Act and refer to the discussion of that section in Roadshow v iiNet above. It does not seem to me that the section or the reasoning in that case excludes the possibility that one person (here, Mr Pacione) who authorises or causes another (here, HSFS) to authorise the infringement by a third person (here, SFSI) might be treated as authorising the relevant infringement. It will be a question of fact in the particular case where authorisation is established, having regard to the matters identified in s 36(1A) of the Copyright Act. 352As I noted above, it seems to me that Mr Pacione had at least a practical power to prevent the authorisation by HSFS of the infringing conduct by SFSI, in the manner noted above, since it would not have occurred had he not exercised his control of HSFS to bring it about; and Mr Pacione not only took no steps to prevent or avoid the doing of the act, which could have included at least causing HSFS to withhold its cooperation by not ceding its business to SFSI, but caused HSFS to allow SFSI to take up that business. These matters seem to me to be sufficient to establish that Mr Pacione authorised HSFS to authorise the relevant conduct for the purposes of s 36(1A) of the Copyright Act. Having said that, it is difficult to see that this claim or an affirmative finding as to this matter adds anything of substance to the finding that I have reached above that Mr Pacione directly authorised the relevant infringement by SFSI. Estoppel defence 353The Cross-Defendants pleaded a defence of estoppel although it was not identified in their list of issues. The Cross-Claimants submit that the limitation period in which to bring an action for infringement of copyright is 6 years and a copyright owner may wait until the last minute to bring an action for infringement if he or she so chooses (LED Builders Pty Ltd v Masterton Homes (NSW) Pty Ltd (1994) 54 FCR 196; 30 IPR 447 at 462-466 per Sheppard J); that Mr Cummings lacked information about the Cross-Defendants' activities, as a result of concealment, and was also inexperienced in business; and that the Cross-Defendants cannot say that Mr Cummings' or Tanmari's delay in taking action was relied on by Mr Pacione or any of his companies or created any expectation that his rights, once the infringements came to light, would not be enforced. They submit that, once FIPL purchased the rights including the copyright, it acted swiftly both to terminate the agreements and to revoke any licence to the extent that any licence remained on foot. 354To the extent that this defence involves some form of representational estoppel, arising from Mr Cummings' or Tanmari's failure to take action in respect of their earlier suspicion that companies associated with Mr Pacione were not paying licence fees, it would be established if, as Deane J noted in Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394 at 444, the relevant conduct involved an unconscientious departure by one party: "from the subject matter of an assumption which has been adopted by the other party as the basis of some relationship, course of conduct, act or omission which would operate to that other party's detriment if the assumption be not adhered to for the purposes of the litigation." 355It does not seem to me that the relevant assumption has been established. The Cross-Defendants do not say, at least in terms, that SFSI continued to grant licences to third parties after April 2009 because Mr Cummings and Tanmari's inaction in the past had led it to think that such inaction would continue in the future. In any event, it seems to me that there is no unconscionability in the Cross-Claimants now seeking to assert their rights where, first, the Cross-Defendants had not been transparent, during the period of the delay, as to either the extent or the basis on which SFSI was licensing third parties without paying licence fees, and where the Cross-Claimants' claim is at least to some extent responsive to the claims brought by the Plaintiffs against them. Claim for additional damages 356The Cross-Claimants also claim additional damages under s 115(4) of the Copyright Act and accept that they must make out an entitlement to such damages, although quantum is not in issue in the proceedings. 357The Cross-Claimants submit that the Cross-Defendants were well aware of Tanmari's rights and the later rights acquired by FIPL. They point to additional factors relevant to the grant of such damages including the flagrancy of the infringement, for the purposes of s115(4)(b)(i) of the Copyright Act. They rely on copyright notices on discs provided by Mr Cummings and Tanmari and on start up screens (Cummings 14.10.13 [121]-[122]; Ex P7, 3/55, Pacione 26.10.12, Ex P7, 3/55) and the acknowledgments as to copyright ownership in the 2002 Agreement (Recital A) (Pacione 26.10.12, Ex P7, 3/41); Exclusivity Agreement (Recital A and cl 7.1(e)) (Pacione 26.10.12, Ex P7, 3/188), the 2004 Agreement (Recital A and cl 7.1(e)) (Pacione 26.10.12, Ex P7, 3/206), the Software Development Agreement dated 11 August 2004 (cl 7.1) (Pacione 26.10.12, Ex P7, 3/225) and the Software Development Agreement dated 30 May 2005 (cl 7.1) (Pacione 26.10.12, Ex P7, 3/238). 358The Cross-Claimants also point to the relevance of deterrence, both to deter the Cross-Defendants as well as a broader policy of general deterrence, a relevant matter under s115(4)(b)(ia) of the Copyright Act. They also point to the Cross-Defendants' persistence in infringing conduct after notice of the copyright owner's rights, a relevant matter under s 115(4)(b)(ib) of the Copyright Act. They also point to the letters dated 21 December 2011 from the solicitors for Mr Cummings and Tanmari on the one hand and FIPL on the other to the solicitors for JRC, HSFS and SFSI putting those parties on notice of the Cross-Claimants' claim that their conduct constituted an infringement of copyright and to the further letters dated 24 January 2012 to the solicitors for JRC, HSFS and SFSI also referring to copyright infringement. They point out that, on 24 May 2013, the Cross-Claimants filed their Cross-Claim, which pleads infringement of copyright in QSS and user documentation by each of the Cross-Defendants and that, notwithstanding notice by these matters, Mr Pacione and his companies have persisted in the relevant conduct. 359The Cross-Claimants also point to what they characterise as a deliberate attempted circumvention of the licensing arrangements by Mr Pacione, JRC and HSFS by purporting to interpose SFSI as licensor, which they contend would be relevant under s 115(4)(b)(i) and (iv) of the Copyright Act. The Cross-Claimants also contend that substantial benefit has accrued to the Cross-Defendants as a result of their infringements (Ex D4 and T100-101, T146-147, T150-151, T156-157) which would be relevant under s 115(4)(b)(iii) of the Copyright Act. On the findings I have reached, a benefit has accrued to at least SFSI as a result of its infringement of copyright in the form of licence fees from various third parties (Ex D4). The Cross-Claimants also point out there is a benefit to SFSI in attracting new custom by purporting to offer the software with rollforming machines and contend that the benefit to the Cross-Defendants is not limited to the licence fees lost to Mr Cummings, Tanmari or FIPL. 360The Cross-Claimants drew attention, in the submissions to which I have referred above, to a number of the factors which were applicable under s 115(4) of the Copyright Act to determining whether additional damages should be ordered. The parties did not make substantive submissions as to the case law in respect of such an order. An order for additional damages under s 115(4) of the Copyright Act is of a similar character to an order for exemplary damages at common law: Aristocrat Technologies Australia Pty Ltd v DAP Services (Kempsey) Pty Ltd (in liq) [2007] FCAFC 40; (2007) 157 FCR 564 at [42] per Black CJ and Jacobson J; Facton Ltd v Rifai Fashions Pty Ltd [2012] FCAFC 9; (2012) 199 FCR 569 at [33]-[36] per Lander and Gordon JJ; Dynamic Supplies Pty Ltd v Tonnex International Pty Ltd (No 3) [2014] FCA 909 at [38] per Yates J. However, additional damages for copyright infringement are not limited to the circumstances in which aggravated or exemplary damages would be recoverable in tort: Luxottica Retail Australia Pty Ltd v Grant [2009] NSWSC 126; (2009) 81 IPR 26 at [39] per White J; Dynamic Supplies above at [42]. An element of penalty is "an accepted feature of copyright legislation", although the courts must also approach the award of additional damages under this section cautiously: Autodesk Inc v Yee (1996) 68 FCR 391 at 394; 139 ALR 735 per Burchett J; Polygram Pty Ltd v Golden Editions Pty Ltd (1997) 76 FCR 565 at 577; 148 ALR 4 per Lockhart J; Dynamic Supplies above at [43]. 361Although the factors referred to in s 115(4)(b) of the Copyright Act are relevant to whether additional damages should be awarded, none of them are necessary to an award of additional damages, and the ultimate question is whether the Court is satisfied that it is appropriate to award such damages, including by reference to all other relevant matters. Something in the nature of reprehensible conduct will generally be required for an order for additional damages: Dynamic Supplies above at [45]ff. When an award of additional damages includes a punitive component, the Court must also have regard to the burden that such damages will visit on the infringer: Amalgamated Mining Services Pty Ltd v Warman International Ltd (1992) 111 ALR 269 at 286-287; 24 IPR 461 per Wilcox J; Dynamic Supplies above at [53]. 362I accept that the Cross-Defendants had notice of Mr Cummings' and Tanmari's claim to copyright, and later to FIPL's claim to copyright arising under the FIPL Purchase Agreement. However, with some hesitation, I have concluded that notice of that copyright was not sufficient to establish flagrancy in SFSI's conduct, since notice of Tanmari's or FIPL's claim to copyright does not establish that either SFSI or Mr Pacione knew or ought to have known that it did not have a right to grant licences to third parties in the relevant circumstances. I have not accepted above that a sub-licence was granted by JRC to SFSI in April 2009, in the manner which JRC and HSFS (as plaintiffs) and Mr Pacione (in his evidence) claimed. Nonetheless, again with some hesitation, I am not satisfied that SFSI or Mr Pacione must have known that SFSI had no right to grant licences for the relevant software, where the arrangements between Mr Cummings and Tanmari on the one hand and JRC, HSFS and Mr Pacione on the other had a lengthy history and were not well-documented, so that the question of the rights of entities associated with Mr Pacione to use the software was by no means straightforward. On the other hand, the findings which I have reached above indicate that the conduct of the Cross-Defendants was by no means transparent, and, in particular, they were neither transparent as to the basis on which SFSI was dealing with third parties or the extent to which it had done so without paying licence fees to Tanmari, and these matters are relevant both to the flagrancy of the breach and are themselves other relevant matters for the purposes of s 115(4) of the Copyright Act. 363It does not seem to me that personal deterrence is likely to be achieved without an order for additional damages, where the quantum of Tanmari's and FIPL's damages might be quantified by reference to lost licence fees, without regard to the additional benefits which SFSI will have obtained by selling roll-forming machines because of its alibility to package QSS with those machines. It seems to me that general deterrence would also not be achieved if SFSI were ultimately left in a position where it was substantially better off by reason of its breach of copyright. 364For these reasons, it seems to me that an order for additional damages ought to be made, although the quantum of such additional damages will be matter for determination at the further hearing as to quantum, and will need to have regard to the amount of the damages that would be awarded to the Plaintiffs on the ordinary basis and potentially also to the burden that an order for additional damages will impose upon the Cross-Defendants, having regard to their individual circumstances. Misleading or Deceptive Conduct (Cross-Claim [67] - [76]) (Cross-Defendants issues 22-28) 365The twenty-second issue identified by the Cross-Defendants, in respect of the Cross-Claim, is whether the reference to QSS as "ProCAD" in the start up screens of QSS licensed by the Cross-Defendants represents that JRC, HSFS and/or SFSI are the owners of the software and source code; represents that JRC, HSFS and/or SFSI are authorised to license the software to third parties; or represents that the software has sponsorship or approval that it does not have. Paragraph 67 of the Cross-Claim pleads that the Cross-Defendants have referred to QSS as "ProCAD" in the start up screens of QSS sub-licensed by them to third parties. In paragraph 67 of the Defence to Cross-Claim, the Cross-Defendants admit that QSS has been marketed as "ProCAD" but otherwise deny the allegations. 366The Cross-Defendants submit, and I accept, that referring to "ProCAD" on a start up screen does not make any representation about who owns the software or the source code. That reference is equally consistent with ownership or a licensing arrangement of some kind. The Cross-Defendants submit, and I also accept, that referring to QSS as "ProCAD" on a start up screen does not, in itself, make any representations that JRC, HSFS or SFSI are authorised to license "ProCAD" to third parties. It seems to me unlikely that such a reference would communicate any such matter to the user of the software, who would assume no more than that "ProCAD" was the name by which the software was known. The Cross-Defendants also point out that there is nothing in the display of the word "ProCAD" on the start up screen to suggest an association with JRC, HSFS or SFSI and the Cross-Defendants have not demonstrated that JRC, HSFS or SFSI have such a reputation in the word that displaying it suggests a reference to JRC, HSFS or SFSI. It also seems to me unlikely that such a reference would communicate anything as to sponsorship or approval, or anything beyond the identity of the program that had been opened, to the user of the software. The Cross-Defendants contend, and I also accept, that referring to QSS as "ProCAD" on the start up screen, does not make any representations in trade and commerce that "ProCAD" has any particular sponsorship or approval, so no question of a contravention of s 29(g)-(h) of the Australian Consumer Law arises. 367Given the findings that I have reached above, such representations, had they been made, would have been misleading or deceptive or likely to mislead or deceive in respect of JRC (since the 2002 Agreement had been abandoned no later than on entry into the 2004 Agreement) and SFSI (which had no rights to QSS for the reasons noted above). The issue would be more complex in respect of HSFS, since it continued to have rights under the 2004 Agreement. It is not necessary to address that issue since I have not found that the representations were made. 368The Cross-Defendants identify further issues as whether statements on SFSI's website represent that SFSI is the owner of QSS; or that SFSI is permitted to license QSS to third parties; or that ProCAD has sponsorship or approval that it does not have; or that JRC, HSFS or SFSI have sponsorship, approval or an affiliation with Mr Cummings, Tanmari and FIPL; whether the representations on the SFSI website are misleading or deceptive; and whether JRC, HSFS or SFSI engaged in conduct that is misleading or deceptive or likely to mislead in contravention of ss 18 or 29(g)-(h) of the Australian Consumer Law (Cross-Claim [67], [69]). The Cross-Claimants submit that the determination of this claim will follow upon the determination of the copyright infringement claim. 369The Cross-Defendants accept that the statements on the SFSI website represent that SFSI was permitted to license QSS to third parties. It does not seem to me that those statements extend further to any representation about ownership, or any representation about any sponsorship, approval or affiliation with Cummings, Tanmari or FIPL. The Cross-Defendants submit that the representation that SFSI was permitted to license QSS to third parties was not misleading or deceptive because, at the relevant time, SFSI was permitted to license QSS to third parties, because JRC granted SFSI the right to grant licences using JRC's rights under the 2002 Agreement. I do not accept that submission for the reasons noted above. The Cross-Defendants submit, and I accept, that only SFSI made the relevant representation, namely, that it was permitted to license QSS to third parties. Paragraph 70 of the Cross-Claim pleads that the domain name for the website is connected to is SFSI and that proposition was put to and accepted by Mr Pacione in cross-examination (T158-159). There is no evidence that, and it was not put to Mr Pacione, that JRC or HSFI (which, as I noted above, had substantially ceased business before the representation was made) had any involvement in the operation of that website. I find that only SFSI engaged in the conduct that I have held to be misleading or deceptive. 370The twenty-sixth issue identified by the Cross-Defendants in respect of the Cross-Claim is whether Mr Pacione is a person involved in the contravention. The Cross-Claimants contend that, where Mr Pacione is the controlling mind of each of the corporate Cross-Defendants, he is a person involved in the contraventions. They submit that, if the Court finds that JRC, HSFS and/or SFSI has contravened ss 18, 29(g) or 29(h) of the Australian Consumer Law, then Mr Pacione is a person involved in the contravention(s) as he has aided, abetted, counselled or procured the contravention; or has been directly or indirectly, knowingly concerned in, or party to, the contravention within the meaning of s 2 of the Australian Consumer Law. Section 236 of the Australian Consumer Law in turn provides that a claimant may recover damages from a person involved in a contravention. 371The Cross-Claimants recognise that the state of mind required to establish that a person is involved in a contravention is knowledge of the essential elements of the contravention: Yorke v Lucas [1985] HCA 65; (1985) 158 CLR 661 at 667 per Mason ACJ, Wilson, Deane and Dawson JJ. They accept that a finding of involvement by Mr Pacione requires that he have knowledge of the falsity of the relevant representations: Australian Competition and Consumer Commission v SensaSlim Australia Pty Ltd (in liq) (No 5) [2014] FCA 340; (2014) 98 ACSR 347 at [535] per Yates J. They point out that it is not, however, necessary for them to prove that Mr Pacione knew that the conduct amounted to a contravention of the Australian Consumer Law: Yorke v Lucas above at 667. They also recognise that, for Mr Pacione to be directly or indirectly knowingly concerned in the contravention by another of a relevant provision, he must have at least some practical involvement in the acts or omissions constituting the contravention: Australian Competition and Consumer Commission v SensaSlim Australia Pty Ltd (in liq) (No 5) above at [543]. 372There is no doubt that Mr Pacione was sufficiently associated with the contravention to be involved in it, if the requisite degree of knowledge on his part is established. Mr Pacione accepted in cross-examination that he was the "controlling mind" of, relevantly, SFSI in the sense that he was and is a director and had carriage and control of its business and was responsible for all decisions made in respect of its business. The relevant cross-examination was as follows: "Q. And you are offering to renew the QSS licence for free for those customers who come across from some other licensor, aren't you? A. Yes. Q. When I say "aren't you", I mean isn't SFSI doing that? A. Yes. Q. And you as the controlling mind of the director of SFSI are authorising that conduct? A. Yeah, on behalf of SFSI, yes, that's correct." (T159) 373However, the question of the extent of knowledge required to establish that a director is involved in a company's contravention arising by misleading or deceptive conduct raises questions of real difficulty that were not fully addressed by the parties' submissions. As the Cross-Claimants recognise, liability for involvement in a contravention at least requires that a director have actual knowledge of the essential facts constituting the contravention (Yorke v Lucas above) and does not require that a director know that the relevant conduct amounted to a contravention of the prohibition on misleading or deceptive conduct under the Australian Consumer Law. At least some cases indicate that a person can be held liable as involved in a contravention where he or she knows the facts which make the conduct misleading, even if he or she has not recognised its misleading character: Heydon v NRMA Ltd [2000] NSWCA 374; (2000) 51 NSWLR 1; Adler v Australian Securities and Investments Commission [2003] NSWCA 131; (2003) 179 FLR 1. In Medical Benefits Fund of Australia Ltd v Cassidy [2003] FCAFC 289; (2003) 135 FCR 1, Stone J took the view that liability requires that the relevant person know that the conduct was misleading, whereas Moore J (with whom Mansfield J agreed) considered that it was only necessary that he or she knew that the representation would convey a meaning contrary to the facts. In Rafferty v Madgwicks [2012] FCAFC 37; (2012) 203 FCR 1, the Full Court of the Federal Court observed that the necessary knowledge to establish involvement in a contravention was knowledge of conduct which had the prohibited character, although it was not necessary to establish knowledge of a contravention of the relevant prohibition. 374The Cross-Claimants submit that Mr Pacione's evidence that he held the view that JRC owned QSS and could deal with it in any way it pleased, and it did so by sub-licensing SFSI in or about April 2009, should be rejected. The Cross-Claimants submit that evidence is contrary to the various acknowledgements by the companies associated with Mr Pacione the Mr Cummings and Tanmari owned the copyright in QSS, to which I have referred above; the fact that in May 2008 Mr Pacione proposed an agreement between HSFS and the predecessor to SFSI (Ex P5); and that Mr Pacione sought but did not obtain consent from Mr Cummings and Tanmari to transfer the rights under the 2004 Agreement from HSFS to JRC in 2009 (Pacione 26.10.12, Ex P7, 3/322, 324, 329, 332-333). I have referred to several of those dealings above. They also contend that Mr Pacione knew from at least 25 February 2004 that JRC did not have rights to license QSS (whether as ProCAD or otherwise) in Australia as a result of the Exclusivity Agreement; and that SFSI never had, relevantly, any right to deal with QSS (whether as ProCAD or otherwise). 375With some hesitation, I have concluded that it has not been established that Mr Pacione was involved with their requisite knowledge in making the relevant misleading and deceptive representation, namely, that SFSI had the right to license QSS to the parties. I have held above that it has not been established that the suggested assignment of JRC's rights under the 2002 Agreement to SFSI was effected. However, as I noted above in dealing with additional damages under s 115(4) of the Copyright Act, the relationships between the parties had a lengthy history and were not well-documented, and I am not satisfied that Mr Pacione had knowledge, at least at this time, that SFSI did not have at least some rights in respect of QSS. 376The twenty-eighth issue identified by the Cross-Defendants in respect of the Cross-Claim is whether JRC, HSFS or SFSI have committed an offence in contravention of s 151(g) and (h) of the Australian Consumer Law as to which the Cross-Claimants may sue. The Cross-Defendants point out, and I accept, that the Cross-Claimants do not have standing to bring a claim in respect of such an offence. The Australian Consumer Law is a schedule to the Competition and Consumer Act and applies as a law by reason of s 131 of the Competition and Consumer Act. Prosecutions for offences under that Act may not be instituted except with the written consent of the Minister or a person authorised by the Minister, unless the proceedings are instituted by the specified authorities, under s 163(4) of the Competition and Consumer Act. There is no evidence of any such consent and this is sufficient to dispose of this claim. Breach of confidentiality/trade secrets (Cross-Claim [77] - [86]) (Cross-Defendants issues 29-32) 377The Cross-Defendants identify the issues in respect of this claim as whether information in a licence key generator is property; whether the information is confidential; whether HSFS owed an obligation of confidence to FIPL; and whether JRC or HSFS breached such an obligation of confidence. 378It is common ground that Mr Cummings provided a computer program that generated licence keys that activate QSS for sub-licensees to Mr Pacione on behalf of JRC or HSFS, although there is a dispute as to when this occurred to which I will refer below. The Cross-Claimants contend that the source code for the program was confidential and was provided to JRC, HSFS and Mr Pacione on the basis that it would be kept confidential and not used or disclosed to any other person. They contend that Mr Pacione, HSFS or JRC have disclosed the licence key generator to SFSI in breach of confidence and SFSI has used the licence key generator in breach of confidence. They contend that knowledge of the obligation of confidence can be imputed to SFSI by its director, Mr Pacione. 379Mr Cummings' evidence is that he provided the licence key generator to Mr Pacione for HSFS in 2004 (Cummings 14.10.13 [113]) and that he did not authorise Mr Pacione or HSFS to provide or use the licence key generator for any other purpose and did not authorise HSFS or anyone to disclose the licence key generator to SFSI (Cummings 14.10.13 [115]-[116]). His evidence was that he said words to the following effect to Mr Pacione when he gave him the licence key generator: "This is for your use only for your customers. Don't disclose it to anyone." (Cummings 14.10.13 [118]) 380Mr Pacione claims that the licence key generator was given to him in August 2002 or early 2003, rather than in 2004 in respect of the 2004 Agreement. Mr Pacione's evidence in reply was that, in early 2003, JRC received an "authorisation number generating software" program that would allow access to the QSS program, which allowed JRC to authorise its customers worldwide to use the QSS program (Pacione 28.1.13 [31]-[32]). Mr Pacione's evidence in his further affidavit of 19 March 2014 was that Mr Cummings gave him a copy of the licence key generator program and the source code files that created the licence key generator in August 2002, on a compact disc, two years before the 2004 Agreement (Pacione 19.3.14 [117]; Ex P7, 3/55). That evidence seems to be supported by a printout of the contents of that disc. 381In cross-examination, the difference between Mr Cummings' account as to the licence key generator and Mr Pacione's account narrowed somewhat, when Mr Pacione gave evidence that he received two versions of the licence key generator, one in August 2002 after the 2002 Agreement at the same time as he picked up the source code, and on the same disk, which was subsequently updated by Mr Cummings from time to time, and another after entry into the 2004 Agreement (T93). Mr Pacione accepted in cross-examination that, obviously enough, if the licence code was not sent to a customer to which QSS was provided, the customer could not continue to use the software (T94). 382An initial question is whether the information represented by the licence key generator was confidential. In Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd [2001] HCA 63; (2001) 208 CLR 199, Gleeson CJ at [30] observed that: "The usual elements for an equitable remedy are, first, that the information is confidential, secondly, that it was originally imparted in circumstances importing an obligation of confidence, and thirdly, that there has been, or is threatened, an unauthorised use of the information to the detriment of the party communicating it." 383The Cross-Defendants refer to the decision in Del Casale v Artedomus (Aust) Pty Ltd [2007] NSWCA 172; (2007) 73 IPR 326, where Hodgson JA (at [40]) identified several factors relevant to whether information is confidential including the extent to which the information is known outside the plaintiff's business; the extent to which the trade secret was known by employees and others involved in the plaintiff's business; the extent of measures taken to guard the secrecy of the information; the value of the information to the plaintiffs and their competitors; the amount of effort or money expended by the plaintiffs in developing the information; the ease or difficulty with which the information could be properly acquired or duplicated by others; whether it was plainly made known to the employee that the material was by the employer as confidential; whether the usages and practices of the industry support the assertions of confidentiality; whether an employee has been permitted to share the information only by reason of his or her seniority or high responsibility; whether the owner reasonably believes these things to be true and that belief is reasonable; and that the information can be readily identified. The Cross-Defendants submit that the Cross-Claimants' evidence does not address the issues raised by Hodgson JA in Del Casale v Artedomus above. Those factors are not, with respect, a checklist and it will not always be necessary to address them. The confidentiality of some information may readily be inferred from its character and the surrounding circumstances. 384Mr Pacione denies that Mr Cummings told him that the licence key generator was to be used only for his customers or not disclosed (Pacione 19.3.14 [118]). Mr Pacione's evidence was also that: "The CD covering label does not say that the contents of the CD are confidential. [CHECK]" (Pacione 19.3.14 [118]) (The reference to "[CHECK]" in that quotation is contained in the text of the affidavit.) Mr Pacione's evidence was also that Mr Cummings provided JRC and HSFS with updates to the licence key generator program from time to time (Pacione 19.3.14 [119]) and that Mr Cummings and Tanmari "did not impose any restrictions on the Plaintiffs' use of the Licence Key Generator" (Pacione 19.3.14 [120]). I understand Mr Pacione's evidence to be intended to suggest, at least by implication, that the licence key generator was not confidential, because he was not expressly told it was confidential, or the label to the compact disc did not indicate it was confidential, or that he did not understand it to be confidential for that reason. It seems to me that this evidence is not credible and the fact that it was given is adverse to Mr Pacione's credit. Mr Pacione has plainly been involved in distributing operating systems for rollforming machines and associated software for a considerable period and there is no suggestion that he did not understand that the generation of a licence key would authorise the operation of that software and that any person who obtained access to a licence key generator would have the practical ability to authorise access to the software without the licensor's consent. The evidence to which I have referred above indicates that the licence key generator was plainly confidential and, so far as Mr Pacione's evidence is concerned, the confidentiality of the licence key generator was self-evident. 385The next question is whether the Cross-Defendants breached confidentiality in respect of that information. Mr Cummings' evidence was that, if SFSI had been sub-licensing QSS to third parties, it would have had to have access to the licence key generator to make QSS work for those sub-licensees (Cummings 14.10.13 [120]). I accept that evidence and find that confidentiality in the licence key generator was breached on that basis. 386The Cross-Defendants also contend that, even if the licence key generator is confidential, the Cross-Defendants have not breached any obligation of confidence because they have contractual rights to use confidential information and trade secrets. They refer to a right to use know-how and trade secrets conferred on JRC under the 2002 Agreement. However, that does not assist the Cross-Defendants, because I have held that the 2002 Agreement was abandoned by at least the time of the entry into the 2004 Agreement. The Cross-Defendants also contend that the 2004 Agreement grants HSFS the rights to use confidential information such as the licence key generator and refer to the non-exclusive licence of the "Software" (as defined) granted to HSFS under cl 2.1 of that agreement, and to the definition of "Software" as including the: "know how ... and trade secrets necessary for the implementation of the Software" (cl 1.1). I accept that HSFS has a continuing right to use the licence key generator in respect of licences to customers under the 2004 Agreement. However, the right to use the licence key generator to generate licences conferred under the 2004 Agreement did not extend to a right to provide it to SFSI so that it could generate licences for software provided to customers which it did not have a right to grant under the 2004 Agreement or otherwise. I also have not accepted the Cross-Defendants' claim that a sub-licence was granted to SFSI in April 2009 so as to confer any rights arising under that agreement on SFSI. 387The Cross-Defendants also contend that, if there was an obligation of confidence, it was owed to Mr Cummings and Tanmari and not to FIPL. They accept that certain types of information such as trade secrets may be transferred or held in trust or charged (Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 at [118]) but contend that the Cross-Claimants have not established that the licence key generator was a trade secret in the relevant sense. It is not clear to me that the submission is of immediate relevance, since Tanmari as well as FIPL have brought the relevant claim. The claimed breach of the duty of confidentiality is therefore established. Trade mark infringement (Cross-Claim [87] - [101]) (Cross-Defendants' issues 35-38) 388FIPL also brings a claim for trade mark infringement in respect of the use of the Australian trade mark for "QUIK SERIES" as to which FrameCAD Ltd is the registered owner. The claim is pleaded by reference to the use of "QUIK SERIES" on a website maintained by SFSI, and FIPL relies on screenshots of that website in November 2011, November 2012 and February - April 2013. FIPL in turn pleads that use is in relation to goods in respect of which the trade mark is registered and constitutes infringement of the trade mark pursuant to s 120(1) of the Trade Marks Act 1995 (Cth). Mr Taylor's affidavit dated 31 October 2013 set out two examples of the alleged infringing use in print outs of SFSI's website dated 19 November 2012 and 13 February 2013. The relevant parts of the website read: "Quik Series Software Licences Renewed ● If you are an existing QSS licensed user - ... ● On QSS version 11.603 or earlier - later versions possible ... ● Don't wish to pay annual Licence fees or deal with FrameCAD. ... SFS International will renew your QSS licence free." (Ex P7, Vol 6, Annexure SMTN). 389The Cross-Defendants identify the issues in respect of this claim as whether FrameCAD Ltd is entitled to be registered as the owner of the registered trade mark "Quik Series Software"; whether the display of the phrase "QUIK SERIES" on the screenshots of SFSI's website is using the registered trade mark as a trade mark in relation to registered goods; whether the display of the phrase "QUIK SERIES" is using a sign in good faith to indicate the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; whether JRC, HSFS or SFSI are infringing the registered trade mark; whether Mr Pacione is liable for the infringement of the registered trade mark; and whether the Cross-Defendants are liable for additional damages in this respect. 390An initial issue arises as to whether FIPL has standing to bring this claim where Frame CAD Ltd is the registered owner of the relevant trade mark. FIPL claims to be an authorised user of the relevant trade mark under s 8 of the Trade Marks Act and claims standing to bring trademark infringement proceedings under s 27(2) of the Trade Marks Act as the authorised user of the trademark (Taylor 31.10.13, [60]-[70]). The position in respect of the trade mark is confusing, where it appears that Mr Cummings and Tanmari initially assigned the mark to FIPL under the Purchase Agreement; FrameCAD Ltd rather than FIPL subsequently registered the mark, although it is unclear how it had acquired an interest in it; and FIPL now claims standing to bring the claim in reliance on an undocumented arrangement by which it is said to have become an authorised user of the mark. The evidence of that arrangement can only be described as unsatisfactory, amounting to little more than conclusory assertions in Mr Taylor's affidavit dated 31 October 2013, that inverted the relevant parties - at least if FIPL's present claim to standing is to be accepted - as follows: "FrameCAD IP has licensed and continues to licence FrameCAD Limited non-exclusively to us (including with the right to apply for registration of and sublicence) the Trade Marks in Australia. FrameCAD Limited uses the Trade Marks, and sublicences that use under the control of FrameCAD IP." In oral evidence, Mr Taylor indicated that the reference to "FrameCAD Limited" in this evidence should be to "FrameCAD IP" (to which I have referred as FIPL) and the reference to "FrameCAD IP" should be to "FrameCAD Limited". An allegation of trade mark infringement seems to me to be a serious matter and whether the person making it has standing to bring it is also a serious matter, to be determined by reference to the gravity of the matters alleged in accordance with s 140 of the Evidence Act 1995 (NSW). I am not satisfied, having regard to the nature of the allegation and the perfunctory quality of Mr Taylor's evidence as to this matter, that FIPL has standing to bring the claim. I am also not satisfied the claim is established for other reasons to which I will refer below. 391The thirty third issue identified by the Cross-Defendants in respect of the Cross-Claim is whether FrameCAD Ltd was entitled to be registered as the owner of the registered trade mark "Quik Series Software." The Cross-Defendants recognise that FrameCAD Ltd is registered as the owner of the Australian trade mark registration number 1468419 "QUIK SERIES". They point out that a court may rectify the trade mark register on the application of an aggrieved person under s 88 of the Trade Marks Act on the same grounds as a person may oppose the registration of a mark. They also point out that paragraph 88 of the Defence to Cross-Claim pleads that the Cross-Defendants "do not admit" that FrameCAD Ltd was the owner of the mark and was entitled to be registered as the owner of the mark. However, the non-admission of this matter does not amount to the assertion of any positive claim that FIPL was not the owner of the trade mark or was not entitled to be registered as owner of the mark, still less a claim to rectification of the trade mark register, in proceedings to which the owner of the trade mark is not party. The Cross-Defendants' submissions go well beyond the pleaded defence in seeking to advance affirmative reasons why the mark should not be registered. It does not seem to me that the Cross-Defendants can bring a claim to rectification of the entry in the trade mark register by pleading no more than that they do not admit its basis. The claim by the Cross-Defendants for rectification of the register fails because the Cross-Claimants' pleaded case does not permit it to be advanced. 392The next issue is whether the references to "Quik Series" on SFSI's website amounted to a use of the registered trade mark as a trade mark so as to amount to an infringement of the mark within the meaning of s 120(1) of the Trade Marks Act. That section provides as follows: "(1) A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered. Note 1: For registered trade mark see section 6. Note 2: For deceptively similar see section 10. Note 3: In addition, the regulations may provide for the effect of a protected international trade mark: see Part 17A." Section 17 in turn contains a definition of a trade mark in the following terms: "A trade mark is a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person. Note: For sign see section 6." The term "sign" is defined in s 6 as follows: "sign includes the following or any combination of the following, namely, any letter, word, name, signature, numeral, device, brand, heading, label, ticket, aspect of packaging, shape, colour, sound or scent." 393In order to establish infringement of the trade mark under s 120 of the Trade Marks Act, FIPL must establish that one or more of the Cross-Defendants have used, as a trade mark, a sign that is substantially identical with or deceptively similar to the trade mark in relation to goods or services in respect of which the trade mark is registered. Several authorities are relevant to determining whether the reference to "Quik Series Software Licences" on SFSI's website, which plainly had something of a descriptive character about it, is properly characterised as use as a trade mark or would have appeared to consumers as possessing the character of a brand, to adopt a formulation approved by the Full Court of the Federal Court in Nature's Blend Pty Ltd v Nestlé Australia Ltd [2010] FCAFC 117; (2010) 272 ALR 487 at [37]. 394In Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326; 101 ALR 700, the Full Court of the Federal Court observed that the word 'CAPLETS' had not been used as a trade mark on the packaging of a paracetamol product. Lockhart J noted (at 341) that: "The context in which CAPLETS appears on the TYLENOL packaging and in its advertising demonstrates plainly in my opinion, that the use is essentially descriptive and not a badge of origin in the sense that it indicates a connection in the course of trade between the product TYLENOL and the appellant. A person looking at the packaging would assume that the word CAPLETS describes or indicates the shape of the product contained in it or the dosage form." Gummow J (as his Honour then was) also observed (at 347-348): "Where the trade mark allegedly used by the defendant comprises ordinary English words (such as "Page Three", considered by Slade J in News Group Newspapers Ltd v The Rocket Record Co Ltd [1981] FSR 89 at 102) then, as this decision illustrates, that circumstance may be taken into account by the court in the process of reasoning by which it accepts or rejects a submission that the use in question is not a trade mark use but a description of the goods in question. To say that is not to gainsay the point made by Dixon CJ in Mark Foys Ltd v Davies Coop and Co Ltd (the Tub Happy case) (1956) 95 CLR 190 at 194-195 that language is not always used to convey a single, clear idea; a mark may have a descriptive element but still serve as a badge of trade origin. However, where the issue is one of infringing use by use of a word mark (as in the present case), the fundamental question remains, to paraphrase what was said by Williams J in the same case (supra) (at 205), whether those to whom the user is directed are being invited to purchase the goods (or services) of the defendants which are to be distinguished from the goods of other traders "partly because" (emphasis supplied) they are described by the words in question." 395In Pepsico Australia Pty Ltd (t/as Frito-Lay Australia) v Kettle Chip Co Pty Ltd (1996) 135 ALR 192; 33 IPR 161, the Full Court of the Federal Court, in dealing with the use of the word 'KETTLE', held that it was not used as a trade mark in respect of kettle cooked potato chips. Sackville J, with whom Lockhart J agreed, observed (at 213): "The purpose and effect of the words are to be determined by having regard to the context in which they are used. ... It is necessary to consider the words used, as they present themselves to buyers or potential buyers of Frito-Lay's chips who are to form a view about what they are meant to connote." 396In Coca-Cola Company v All-Fect Distributors Ltd [1999] FCA 1721; (1999) 96 FCR 107 at [19], the Full Court of the Federal Court observed that: "Use "as a trade mark" is use of the mark as a "badge of origin" in the sense that it indicates a connection in the course of trade between goods and the person who applies the mark to the goods ... That is the concept embodied in the definition of "trade mark" in s 17 - a sign used to distinguish goods dealt with in the course of trade by a person from goods so dealt with by someone else. " That approach was approved by French CJ, Gummow, Crennan and Bell JJ in E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15; (2010) 241 CLR 144 at [43]. In Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd [2013] FCA 986; (2013) 102 IPR 400 at [90]-[92], Jacobson J in turn summarised the applicable principles as follows: "When a claim for infringement is made, a pivotal question is whether the use complained of is use by the alleged infringer as a trade mark. The answer to that question requires an understanding of the "purpose and nature" of the impugned use: Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326 at 347 (Gummow J), citing Shell at 426 per Kitto J. Use "as a trade mark" is use as a "badge of origin" in the sense that it indicates a connection in the course of trade between goods and the person who applies the mark to the goods. This is the concept embodied in the definition of a trade mark in s 17 of the Trade Marks Act, namely as a sign used to distinguish goods dealt with in the course of trade by a person from goods so dealt with by someone else: Coca-Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107 at [19] (Black CJ, Sundberg and Finkelstein JJ); E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144 at [43]. In Coca-Cola at [20] their Honours went on to say that the authorities (including Shell and Johnson & Johnson) show that the question is whether the sign used indicates origin of goods in the user of the sign; whether there is a connection in the course of trade between the goods and the user of the sign." 397FIPL's written submissions as to whether the relevant use was "use" for the purposes of the Trade Marks Act are somewhat conclusory in character, as follows: "As submitted, the works QUIK SERIES are clearly being used to distinguish the software (the goods) form those of other traders. This constitutes 'use' of the Trade Mark pursuant to section 7 of the Trade Marks Act and to distinguish the goods in the course of trade: section 17 of the Trade Marks Act." 398The Cross-Defendants respond that SFSI did not use the trade mark as a trade mark and did not infringe s 120 of the Trade Marks Act. They submit that SFSI was merely using the phrase "QUIK SERIES" to describe the software, because that was the name of the software, rather than as a badge of origin to indicate a connection in the course of trade. Mr Pacione's evidence, in answer to a question as to how the product could be marketed as "QSS" was, simply enough, "[b]ecause that's what it is" (T160). His evidence in cross-examination (T161) was, in effect, that the phrase was used to identify the software since "there are some customers that understood it as "Quik Series Software"", in circumstances that there was no practical way of doing so other than by use of that phrase as a description of the product. I accept this submission. It seems to me that the relevant use was merely to identify the software with which SFSI (wrongly) claimed to be entitled to deal. To adopt the language of Gummow J in Johnson & Johnson above, users of SFSI's website were simply being told what software SFSI offered to renew, not being invited to acquire the goods (or services) of SFSI on the basis that they were distinguished from the goods of other traders partly because they were described by the phrase "Quik Series Software Licences." 399The Cross-Defendants also contend that, even if they used the trade mark as a trade mark, they did not infringe that trade mark because they were using the sign in good faith to indicate a characteristic of the goods, namely to describe the software, under s 122(1)(b) of the Trade Marks Act. It is not necessary to determine this question given the findings that I have reached above, although the descriptive character of the usage of the phrase "Quik Series Software Licences" on SFSI's website would have gone some way to establishing that defence. 400Next, the Cross-Defendants contend that they were (or SFSI was) not infringing the trade mark because the registered trade mark owner's predecessors in title granted them the right to use the trade mark in relation to QSS. They rely on rights to use the trade mark conferred on JRC under the 2002 Agreement. I would not have accepted this submission, had it been necessary to determine the question, both because that agreement had been abandoned by 2004 as noted above and because it did not confer any right to use the trade mark on SFSI. The Cross-Defendants also rely on the grant of rights to HSFS under the 2004 Agreement. This issue does not arise and, in any event, the relevant website was operated and the mark used by SFSI rather than HSFS and the grant of rights to HSFS under the 2004 Agreement would not have assisted SFSI in that regard. The further issues whether Mr Pacione is liable for the infringement of the registered trade mark and whether the Cross-Defendants are liable for additional damages in this respect also do not arise. Summary and orders 401In summary, I have held that the 2002 Agreement resulted in the grant of a non-exclusive licence to JRC to use QSS in a particular form, as at July 2002, and as updated by updates provided by Mr Cummings, which was not restricted to licensing QSS to Stratco. The 2002 Agreement was, however, abandoned no later than the date of entry into the 2004 Agreement. I have held that the 2004 Agreement did not limit HSFS to licensing QSS and updates to customers who were purchasing a "complete turnkey solution", and was not limited to a period of seven years or to existing customers at the end of that period. I have held that HSFS did not breach the 2004 Agreement by reason of non-payment of licence fees for licences granted by SFSI in the relevant period and the termination of the 2004 Agreement was not effective. I have held that the Defendants were only obliged to provide new releases of QSS compatible with IntelliCad version 4, otherwise unless agreed in writing, under the 2004 Agreement; that both parties had breached the obligations under the 2004 Agreement to enter into an escrow agreement; and that an order for specific performance of that obligation should not now be made. The Plaintiffs' claims in respect of breach of contractual obligations regarding development services, confidential information and good faith, the tort of conspiracy, misleading or deceptive conduct, unconscionability, the tort of inducing breach of contract and for groundless threats of infringement have not been established. 402The Cross-Claimants have succeeded, in significant respects, in respect of the Cross-Claim. I have held that three identified versions of QSS are subject to a proper claim for copyright. I have held SFSI liable for copyright infringement and that HSFS and Mr Pacione had authorised the relevant infringement by SFSI and that the Cross-Claimants are entitled to additional damages under the Copyright Act in respect of the infringement. The Cross-Claimants' claims for misleading or deceptive conduct against SFSI regarding representations on its website and for breach of a duty of confidentiality against the Cross-Defendants have also been established. The Cross-Claimants' claim for trade mark infringement has not been established. 403I will hear the parties as to whether any orders are properly made at this point to give effect to the findings in this judgment and as to any further directions which should be made in respect of the further hearing as to quantum. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 September 2014