Council of the City of Sydney v Goldspar Pty Ltd

REASONS FOR JUDGMENT 1 This is an application for third party discovery pursuant to O 15A r 8 of the Federal Court Rules which arises in this way. In the main proceeding between the Council of the City of Sydney ("the Council") as applicant and Goldspar Pty Limited ("Goldspar") and another as respondents, it is alleged by way of cross-claim that the Council has represented to Streetscapes Projects (Australia) Pty Limited ("Streetscapes"), respondent to this motion and to its customers, that it is an infringement of the Council's copyright in certain drawings to manufacture certain street poles except under licence from the Council. A copy of a letter to that effect is in evidence on this motion, which is directed to Streetscapes. It does make claims in accordance with that allegation and says "You are welcome to provide a copy of this letter to prospective customers". The purpose of third party discovery is to ascertain to whom that letter has been provided, or to whom its contents have been communicated. 2 It seems to me that that is a relevant inquiry, that the evidence which will be disclosed is certainly relevant to the preparation of the case, and it will almost certainly be admissible at the hearing (although I should not, and do not, pre-judge that issue). It is put, I think correctly, that the evidence is required in order for Goldspar to prepare its case for damages arising out of any misleading conduct which it establishes. There are orders on foot at the moment requiring that evidence to be put on fairly shortly. 3 I am thus satisfied that the material sought has sufficient significance for the purposes of the principal proceeding to warrant the rather unusual course of affording third party discovery. I also take into account that Streetscapes is by way of being a licensee of the Council. Although that is far from the relationship between parent and subsidiary which has sometimes founded these orders, it indicates that the degree of interference with a third party is not undue. 4 On the other hand, as Goldspar and Streetscapes are competitors, I have to be astute, if I can, to limit the degree of commercial advantage which might be taken of the situation. That, in principle, is accepted by counsel for Goldspar, and I have indicated in the course of the argument a regime which would seem to me to be appropriate to take account of that circumstance and which is reflected in the draft orders. 5 I should particularly mention the question of costs. In my opinion, there is a strong prima facie entitlement of a third party which is called upon to give discovery to recover costs both of appearing on the application, and in providing the discovery. A third party has no interest in the litigation at all, and there is no reason why it should be out of pocket for a reasonable approach to what is required of it. In my view, a respondent to a motion for third party discovery will almost always be entitled to appear on the return of the motion. That party does not know anything about the principal proceeding in any direct way, and is entitled to protect itself in all respects. 6 I make orders in accordance with the draft orders which have been handed up which I have initialled. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles.