Boomerang Investments Pty Ltd v Padgett

1. The trial listed for two days commencing 16 December 2021 be vacated.
2. All questions of costs arising out of or in connection with the First and Second Respondents' recusal applications be reserved. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

PERRAM J: 1 This matter is listed for a hearing on damages for two days commencing on 16 December 2021. On 1 December 2021 I was notified that the First and Second Respondents ('Glass Candy') desired me to recuse myself from the hearing. That application was heard late in the afternoon on 7 December 2021 and for half a day on 9 December 2021. On 10 December 2021 my Associate informed the parties that I had recused myself, vacated the trial dates and reserved all questions of costs connected with Glass Candy's recusal application. These are my reasons for taking that course. 2 The First and Second Respondent, Mr Padgett and Ms Monahan, are (or were) a band called 'Glass Candy'. The Applicants (together, 'Boomerang') are the owners of the copyright in a well-known song 'Love is in the Air'. Glass Candy composed a song entitled 'Warm in the Winter' and also another song 'France is in the Air'. Boomerang alleged that both songs infringed the copyright in 'Love is in the Air'. A trial on the issue of whether the copyright had been infringed was held in 2019. On 24 April 2020 I delivered judgment in Boomerang Investments Pty Ltd v Padgett (Liability) [2020] FCA 535 ('Liability Judgment'). I concluded that Glass Candy had deliberately copied Love is in the Air and had given false evidence before me in an attempt to disguise that fact. 3 On 14 July 2021, following a period of interlocutory skirmishing, the matter returned to me for a case management hearing in order to get the damages case ready for trial. I raised with the parties at that time the possibility that I might be disqualified from hearing it by reason of the adverse credit findings I had made in the Liability Judgment. I indicated that it would be better that that issue were sorted out sooner rather than later. Shortly afterwards, on 19 July 2021, I fixed the damages case for trial on 16 and 17 December 2021. 4 Glass Candy's desire that I should recuse myself was conveyed to me nearly five months after I had raised the issue with them and two weeks before the trial was due to start. Both Mr Padgett and Ms Monahan have put on affidavits for the damages part of the case. Broadly speaking their affidavits deal with two topics: (a) the correctness of my credit findings in the Liability Judgment; and (b) whether they would have agreed to license the copyright in Love is in the Air if they had known that Warm in the Winter infringed the copyright in the former. 5 It is likely in my view that evidence directed to (a) is an abuse of process, however, it is not necessary to form a concluded view about that. Even if I reject that evidence now (as Boomerang sought to have me do) that would still leave Glass Candy's evidence on topic (b) which they are certainly entitled to lead on the damages case. Once the damages case is heard I do not see how I can avoid addressing as a factual matter the questions to which (b) gives rise. 6 Having found that Glass Candy gave false evidence to the Court at the liability trial I consider that a fair-minded lay observer might reasonably apprehend that I might not bring an impartial mind to resolving the issues comprised in (b): Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337 at [6]. In particular, such a bystander is likely to think that, having concluded that Mr Padgett and Ms Monahan made a calculated effort to mislead me at the first trial, I am likely to regard their evidence with considerable scepticism. 7 Mr Hall SC who appeared with Ms Beaumont for Boomerang endeavoured to persuade me that I would stand in the same position as any other judge who heard the case when it came to assessing the credit of Mr Padgett and Ms Monahan at the damages trial. Whilst I accept the correctness of that submission from an instrumental perspective, I do not think it really meets Mr Cobden SC's point. His submission is concerned not with my actual capacity to make the credit findings but rather with what a fair-minded lay observer might reasonably apprehend about that capacity. These are not the same thing. Consequently, I accept that a reasonable apprehension of bias does arise. 8 In the event that I concluded that grounds had been shown why I should recuse myself Mr Hall then submitted that Glass Candy had waived any such objection. Here the point was that I had raised recusal with the parties on 14 July 2021 and nothing had been done about the matter for five months until the very eve of the damages trial. I accept that a party can, by its conduct in permitting a case to proceed, be taken in some circumstances to have waived any objection to a particular judge hearing the case. For example, it is plainly not acceptable for a party to save the point up during the course of the trial only to deploy it once it appears that the trial is heading south. 9 Mr Williams, the solicitor for Glass Candy, gave evidence about the circumstances leading up to the disqualification application. That evidence establishes that it was known within Glass Candy's camp from September 2021 that Mr Padgett and/or Ms Monahan might well put on the evidence. My initial impression was that it was at that time that Glass Candy should have applied to me to disqualify myself. However, Mr Cobden submitted, and I accept, that any such disqualification application would have been premature prior to the filing of their evidence. Until the evidence was filed it could not be said with certainty that the disqualification issue was likely to arise. 10 Mr Padgett's affidavit was filed on 29 November 2021 and Ms Monahan's affidavit was filed on 20 October 2021. The disqualification application was notified to me on 1 December 2021. I do not consider this is a period of time from which one could infer that Glass Candy was acting in a way which was inconsistent with any continuing entitlement to apply for my recusal. I do not think that they had yet reached a fork in the road. Consequently, I do not accept that Glass Candy waived its entitlement to make the present application. 11 In that circumstance, I conclude that I should disqualify myself from the further conduct of the matter which will now need to be allocated to a new docket judge. The only orders I will make are orders vacating the trial dates and reserving all questions of costs arising from the recusal application. For completeness, I have not felt it necessary to deal with the Applicants' objections advanced on various grounds to the evidence in (a). Glass Candy objected to my dealing with those objections on the basis that there was a reasonable apprehension that I would not bring a fair mind to their determination either. In light of the conclusions I have reached it is not necessary to enter upon that topic. 12 Finally, whilst I have concluded that in terms of waiver the relevant date for any analysis is the date of the filing of the affidavits (only at which time did it become formally possible to articulate the basis for any recusal), it is highly regrettable that Glass Candy did not raise the matter once it became apparent to their advisers that there was a real risk that they were going to be called. From a case management perspective, what has occurred is highly undesirable and, with respect, was avoidable. This is particularly so where I explicitly raised the problem with Glass Candy at the case management hearing on 14 July 2021. Thus whilst Glass Candy's conduct does not give rise to a waiver that does not mean that the conduct was appropriate or blameless. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Perram.