Hurd v Zomojo Pty Ltd

Federal Court of Australia (Full Court)|2015-10-21|Before: Miller CJ, Beach JJ

Introduction 1 Zomojo Pty Ltd ("Zomojo") brought a proceeding in this Court (VID 1478 of 2011) against Mr Matthew Hurd Zeptonics Pty Ltd ("Zeptonics"), Crosswise Pty Ltd ("Crosswise"), MD Hammer Pty Ltd, Zepto Markets Pty Ltd ("Zepto Markets"), Zepto Fabrics Pty Ltd ("Zepto Fabrics"), Zeptoip Pty Ltd ("Zeptoip") and Trademach Pty Ltd ("Trademach"). There was also a cross-claim against Zomojo by Mr Matthew Hurd, Jolene (Tas) Pty Ltd and the Hurd Family Superannuation Fund. After a hearing on liability, including all of the cross-claim, a judge of this Court (Gordon J) delivered reasons for judgment on 19 December 2012 (Zomojo Pty Ltd v Hurd (No 2) [2012] FCA 1458). We will refer to this as the substantive judgment. 2 After the reasons for judgment had been handed down, Mr Matthew Hurd provided an undertaking that he would not take any "steps to put [himself] in a position from which [he] would be unable to comply with an injunction ordered by the Court in the terms set out in paragraph 377 of Justice Gordon's reasons for judgment dated 19 December 2012". 3 On 5 February 2013, Gordon J made orders which gave effect to the conclusions which she had reached in the substantive judgment (Zomojo Pty Ltd v Hurd (No 3) [2013] FCA 54). Those orders required the respondents to perform a number of acts by 4.00 pm on 26 February 2013. 4 Zomojo formed the view that the respondents and four third parties had not complied with the orders or had been involved in the non-compliance and, on 8 March 2013, it issued an interlocutory application against the respondents and four third parties claiming a number of orders. The orders sought by Zomojo included an order pursuant to r 41.09 of the Federal Court Rules 2011 (Cth) ("the Rules") appointing a person to undertake the acts required by some of the orders made on 5 February 2013, freezing orders against the respondents and the third parties, and declarations of contempt against the respondents and the third parties. Zomojo's interlocutory application was accompanied by various statements of charges of contempt ("charges"). In addition, the application was accompanied by an affidavit sworn by Ms Janet Whiting, who is a partner of Corrs Chambers Westgarth. That firm acts as solicitors for Zomojo. 5 One of the third parties to Zomojo's interlocutory application was Mr John Hurd, who is Mr Matthew Hurd's father. He had sworn an affidavit on 27 February 2013 "in support of Federal Court Orders dated the 5th February 2013 for compliance with clauses 16 to 21 inclusive" and that affidavit was filed on 28 February 2013. In the affidavit, Mr John Hurd deposed to the fact that he was the director of the corporate respondents and was authorised to make the affidavit on their behalf. He made statements about the financial affairs of Zeptonics, Crosswise, Zepto Markets, Zepto Fabrics, Zeptoip and Trademach respectively. Mr John Hurd was served with charges dated 7 March 2013. 6 On 18 March 2013, Mr John Hurd swore a second affidavit which was said to be "in support of compliance with Federal Court orders of 5th February 2013". He deposed to the fact that he was the director of the second to seventh respondents and was authorised to swear the affidavit on their behalf. In the affidavit, he made statements about the compliance by the respective companies with the orders made on 5 February 2013. 7 On 5 April 2013, Mr Matthew Hurd swore an affidavit which was said to be "in support of a response to the statement of charge dated 7 March 2013". In that affidavit, Mr Matthew Hurd gave various explanations concerning compliance or otherwise with the orders made on 5 February 2013. 8 On 8 May 2013, Ms Whiting swore a second affidavit. 9 Another judge of this Court (Tracey J) heard the contempt charges on 9, 10 and 17 May 2013. At that stage, the hearing was restricted to a consideration of whether the charges were established. Penalty (if relevant) was to be dealt with later. His Honour received in evidence the two affidavits of Ms Whiting, Mr John Hurd's first affidavit and certain paragraphs of Mr John Hurd's second affidavit and of Mr Matthew Hurd's affidavit. There was brief cross-examination of Ms Whiting by counsel for the respondents and Mr John Hurd. On 28 May 2014, Tracey J delivered his reasons for judgment. In those reasons he indicated that he found certain charges to be established (Zomojo Pty Ltd v Hurd (No 5) [2014] FCA 537). On 19 June 2014, he made declarations of contempt and an order for the payment of costs. Those are the orders which are the subject of the present appeal by Mr Matthew Hurd and Mr John Hurd. On 19 June 2014, Zomojo advised his Honour that it did not seek any fines in relation to the contempts found by him. 10 Zeptonics, Crosswise, Zepto Markets, Zepto Fabrics, Zeptoip and Trademach were each found guilty of contempt, and declarations of contempt were made against each of them. At the relevant times, Mr Matthew Hurd had the day to day control of the corporate respondents, and Mr John Hurd was the director of each of the corporate respondents. The corporate respondents are no longer in the control of the "Hurd interests" and they have not appealed against the declarations made against them. Although Mr Matthew Hurd suggested that some of his submissions applied with equal force to the corporate respondents, the orders made against the corporate respondents are not challenged before the Court and we do not propose to address them.

The Orders made on 5 February 2013 11 The orders which were made on 5 February 2013, and which are relevant for the purposes of this appeal, are as follows: 12. By 4:00 pm on 26 February 2013, each Respondent take all necessary steps within his or its power to assign the ownership of all of his or its rights in each of the following to the Applicant: (a) the product or products (including any parts thereof) known as 'OptiCast'; (b) the product or products (including any parts thereof) known as 'ZeptoCast'; (c) the product or products (including any parts thereof) known as 'ZeptoLink'; (d) the product or products (including any parts thereof) known as 'ZeptoNIC'; (e) the product or products (including any parts thereof) known as 'ZeptoAccess KRX'; and (f) the product or products (including any parts thereof) known as the 'Crosswise ATS', (collectively, the 'Products', and, individually, a 'Product'). 14. By 4:00 pm on 26 February 2013, each Respondent deliver up to the Applicant all documents (including electronic documents and files) in his or its possession, power or control that record or refer to each Product, or any prototypes for each Product, including: (a) all patents held or applications for patents lodged by any of the Respondents concerning the technology or techniques employed in each Product; (b) all purchase orders, agreements, invoices and receipts concerning the sale of each Product; (c) all purchase orders, agreements, invoices and receipts concerning the production of each Product; (d) all agreements and arrangements entered into by any of the Respondents concerning the use of or access to (directly or indirectly) each Product; and (e) all agreements and arrangements entered into by any of the Respondents with investors concerning the ownership of, or rights to the proceeds of sale of, each Product. 15. Each Respondent forthwith cease: (a) using or accessing (directly or indirectly) the Products; and (b) assisting, facilitating or enabling any other person to use or access (directly or indirectly) the Products. 16. By 4:00 pm on 26 February 2013, Zeptonics (by its proper officer) file and serve an affidavit: (a) deposing to all profits it derived by reason of or arising out of the Leading Agreement; and (b) deposing to the precise manner of calculation of that profit or those profits stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified. 17. By 4:00 pm on 26 February 2013, Crosswise (by its proper officer) file and serve an affidavit: (a) deposing to all profits it derived by reason of or arising out of the development, marketing and sale of the Product referred to in Order 12(f) of these Orders known as 'Crosswise ATS'; and (b) deposing to the precise manner of calculation of that profit or those profits stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified. 18. By 4:00 pm on 26 February 2013, Zepto Markets (by its proper officer) file and serve an affidavit: (a) deposing to all profits it derived by reason of or arising out of the development, marketing and sale of the Product referred to in Order 12(e) of these Orders known as 'ZeptoAccess KRX'; (b) deposing to the precise manner of calculation of the profit or those profits in (a) stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified; (c) deposing to all profits it derived by reason of or arising out of the SunGard Agreement; and (d) deposing to the precise manner of calculation of the profit or those profits in (c) stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified. 19. By 4:00 pm on 26 February 2013, Zepto Fabrics (by its proper officer) file and serve an affidavit: (a) deposing to all profits it derived by reason of or arising out of the development, marketing and sale of the Product referred to in Order 12(c) of these Orders known as 'ZeptoLink'; and (b) deposing to the precise manner of calculation of that profit or those profits stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified. 20. By 4:00 pm on 26 February 2013, Zeptoip (by its proper officer) file and serve an affidavit deposing: (a) to all profits it derived by reason of or arising out of it holding any patents concerning the Applicant's confidential information identified in Annexure A to the Reasons for Judgment of 19 December 2012; and (b) deposing to the precise manner of calculation of that profit or those profits stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified. 21. By 4:00 pm on 26 February 2013, Trademach (by its proper officer) file and serve an affidavit: (a) deposing to all profits it derived by reason of or arising out of the development, marketing and sale of each Product; and (b) deposing to the precise manner of calculation of that profit or those profits stating in each case the amount of gross receipts in respect of that product and the amount and occasion of each expenditure allowed against those receipts in the calculation of the profits identified.

The Orders which are the subject of the Appeal 12 The primary judge made the following declaration in relation to Mr Matthew Hurd: 1. The First Respondent is guilty of contempt of paragraphs 12, 14 and 15 of the order of the Court made on 5 February 2013. Mr Matthew Hurd appeals against that declaration. 13 The primary judge made the following declaration in relation to Mr John Hurd: 8. The Fourth Third Party is guilty of contempt of paragraphs 12, 14, 16, 17, 18, 19, 20 and 21 of the order of the Court made on 5 February 2013. Mr John Hurd appeals against that declaration. 14 The primary judge made the following order as to costs: 10. The First to Third and Fifth to Eighth Respondents and the Fourth Third Party pay the costs of the Applicant's interlocutory application dated 7 March 2013, including reserved costs, save for the costs relating to the orders sought by the Applicant against the First to Third Third Parties and the costs relating to the appointment of Rodney McKemmish. Both Mr Matthew Hurd and Mr John Hurd appeal against that order.

The Primary Judge's Reasons 15 The primary judge identified the background to the charges. The primary judge said that Zomojo was a company involved in what is known as high frequency trading. It was incorporated on 3 June 2005. Mr Matthew Hurd was a director, an officer, an employee, the company secretary and a shareholder of Zomojo from its inception until early 2011. He was employed under a service agreement. Mr John Hurd was an accountant employed by Zomojo. 16 The primary judge said that Mr Matthew Hurd became frustrated with the manner in which Zomojo was conducting its business, and during the year prior to his resignation in January 2011, he embarked on a project to create a business which was to compete with Zomojo. His scheme was further developed after he left Zomojo. 17 In the proceeding Zomojo brought against Mr Matthew Hurd and a number of corporate entities which he had established or with which he was associated, Zomojo alleged that Mr Matthew Hurd had breached his contractual, fiduciary and statutory obligations to it thereby causing the company substantial damage. 18 The primary judge noted that the hearing of Zomojo's claims commenced before Gordon J on 22 October 2012 and concluded on 2 November 2012. The trial was divided into two parts. The first part of the trial dealt with issues of liability, and the second part which considered appropriate relief for Zomojo was heard by Jessup J on 25 and 26 March 2014. Further details are set out in our reasons for judgment in connection with the appeal and application for prerogative relief by Mr Matthew Hurd (Hurd v Zomojo Pty Ltd [2015] FCAFC 147). 19 The primary judge said that Gordon J found that Mr Matthew Hurd had breached his contractual, fiduciary and statutory duties to Zomojo, and that the corporate respondents associated with Mr Matthew Hurd (i.e., Zeptonics, Crosswise, Zepto Markets, Zepto Fabrics, Zeptoip and Trademach) had assisted and participated in Mr Hurd's misuse of Zomojo's confidential information. 20 The primary judge noted that in accordance with a direction made by her Honour, the parties submitted minutes of proposed orders after her Honour had delivered her reasons for judgment on 19 December 2012. Having considered those minutes of proposed orders, her Honour made a number of declarations and, inter alia, the orders referred to above. The orders were forwarded by electronic transmission to the solicitors acting for the various parties. The orders did not bear an endorsement of the kind contemplated by r 41.06 of the Rules. 21 The primary judge noted that her Honour made declarations that six of the seven corporate respondents held profits they had derived from certain activities as a constructive trustee for the benefit of Zomojo and were liable to account to Zomojo for those profits. 22 His Honour said that Zomojo alleged that Mr Matthew Hurd and a number of corporate respondents had failed to comply with her Honour's orders, and that it was also alleged that Mr John Hurd had aided and abetted a contravention of orders 12 to 21 inclusive. 23 His Honour considered a submission by the alleged contemnors that Ms Whiting's second affidavit should not be admitted in evidence because it had not been served with the charges as required by r 42.12(b) of the Rules. His Honour rejected that argument. He said that r 42.12(b) did not have the effect that the Court could not, in the exercise of a discretion, allow a prosecutor to rely on additional affidavit material served before the trial. He noted that a prosecutor may wish to call evidence from persons who are not willing to swear affidavits, but who are prepared to give oral evidence at trial. 24 His Honour also referred to r 1.34 of the Rules which gives the Court power to dispense with compliance with any of the Rules. After referring to authority and the nature of the evidence given by Ms Whiting in her second affidavit, his Honour said that he considered it appropriate to exercise, "to the extent necessary", the dispensation power conferred by r 1.34 of the Rules. 25 His Honour considered the admissibility in evidence of the affidavits of Mr John Hurd sworn on 18 March 2013 and the affidavit of Mr Matthew Hurd sworn on 5 April 2013. 26 Before outlining the primary judge's approach to that matter as set out in his written reasons, it is necessary to note what happened at the hearing. Shortly before 4.15 pm on 9 May 2013, counsel for Zomojo closed its case. Counsel for the alleged contemnors asked the Court to adjourn early so that he could consider whether the alleged contemnors would call evidence. He said that he would advise counsel for Zomojo of their decision. The Court then adjourned. At some stage before the resumption of the hearing on 10 May 2013, counsel for the alleged contemnors advised counsel for Zomojo that they would not call evidence. When the hearing resumed on 10 May 2013, counsel for Zomojo applied to tender Mr Matthew Hurd's affidavit and Mr John Hurd's second affidavit on the ground that they contained admissions. The primary judge heard submissions and then ruled that certain paragraphs in each affidavit would be admitted. His Honour said: HIS HONOUR: Yes. I propose to grant you leave to tender those two affidavits and admit them to the extent that they contain admissions adverse to the interests of the deponents and the corporate bodies on whose behalf the affidavits were sworn. As to the affidavit of Mr John Hurd, sworn 18 March 2013, as to paragraphs 1, 3, 5 and 7, and in respect of the affidavit of Matthew Hurd, sworn on 5 April 2013, as to the parts specifically identified by Dr Collins in paragraphs 5, 8, 9, 10, 12 and 13, I will give more detailed reasons for that ruling in my judgment in due course. But for present purposes I will summarise those reasons. The affidavits were sworn, as they state, on their face, in response to, in the case of Mr Matthew Hurd, the statement of charge which had been filed on 7 March 2013, in the case [of] Mr John Hurd, in support of alleged compliance with the orders her Honour made on 5 February 2013. They were both sworn in full knowledge that the charges had been laid and, indeed, set out to deal specifically with the allegations of non-compliance that appear in the statement of charge. The material to which my attention has been directed and on which the applicant seeks to rely in material which, in my view, falls within the definition of admission in the Evidence Act, and the material is admissible as admissions against interest for the purpose of that Act, and on that basis I do admit it. As to the leave to reopen, whether or not there was formal closure last night, I granted an indulgence to the respondents in order to ensure that a considered decision could be made, and this application was made before any formal statement was made on behalf of the respondents that they didn't propose to go into evidence. It was made on the basis of an intimation to that effect between counsel overnight, and in those circumstances I don't think it can be fairly said that any prejudice from a procedural point of view resulted from what has since transpired. As I say, I will expand on those reasons in due course. 27 We return to the primary judge's written reasons. The primary judge set out what he considered to be the relevant passages in the two affidavits. He considered whether the evidence in the affidavits could properly be regarded as admissions and, in that context, he referred to ss 81, 82 and 83 of the Evidence Act 1995 (Cth). He decided that certain paragraphs in the affidavits contained admissions. He noted that admissions by one deponent could not be used against the other. He rejected a submission that the admissions in Mr John Hurd's affidavits should not be received in evidence because to do so would violate his privilege against self-incrimination. 28 Having dealt with what he described as the evidentiary issues, the primary judge turned to identify the relevant principles with respect to contempt of court. His Honour referred to the source of this Court's power to punish for contempt of court (Federal Court of Australia Act 1976 (Cth) s 31(1)). His Honour referred to the following passage from the reasons for judgment of Merkel J in Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494 ("Louis Vuitton Malletier SA v Design Elegance") at 497-498: Deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct be casual, accidental or unintentional: see Australasian Meat Industry Employee' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 106-107 and 112-113. However, the disobedience will amount to a criminal contempt if it involves 'deliberate defiance or, as it is sometimes said, if it is contumacious': see Witham v Holloway (1995) 183 CLR 525 at 530 … However, as all proceedings for contempt are now regarded as criminal in nature, all of the charges must be proved beyond reasonable doubt: see Witham at 534. His Honour referred to the well-known passage in the reasons for judgment of Gillard J in Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd and Ors [2003] VSC 201 ("Advan Investments v Dean Gleeson Motor Sales") at [31] and [32]: In order to prove a civil contempt of court involving a breach of an order of the court, the plaintiff has to prove the following: (i) that an order was made by the court; (ii) that the terms of the order are clear, unambiguous and capable of compliance; (iii) that the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules of Court; (iv) that the alleged contemnor has knowledge of the terms of the order; (v) that the alleged contemnor has breached the terms of the order. … in proving element (v) it must be proven that the act or omission which constituted the breach of the order was deliberate and voluntary. Finally, his Honour referred to Witham v Holloway (1995) 183 CLR 525 ("Witham v Holloway") at 534 and said that all charges of contempt, whether civil or criminal, must be proved beyond reasonable doubt. 29 We turn now to identify his Honour's conclusions with respect to each of the orders which are relevant on the appeal.

Paragraph 12 30 The primary judge said that with respect to the alleged contravention of this order, Zomojo's submissions proceeded on the realistic assumption that any assignment of rights in relation to a particular product would require the creation of legal documentation by the relevant respondent and the service of those documents on Zomojo, thereby effecting the assignment. In each case, the order in paragraph 12 required this to occur by 26 February 2013. Zomojo alleged that no assignment had occurred by 7 March 2013 when the charges were laid. 31 His Honour noted that, in the case of the order in paragraph 12, Zomojo relied on what it contended were admissions by Mr Matthew Hurd and Mr John Hurd each on his own behalf and on behalf of the relevant respondent companies. 32 His Honour referred to the following passage in Mr Matthew Hurd's affidavit sworn on 5 April 2013. I believe that by 14 March 2013 the companies and I were in compliance. I believe the Products (including any parts thereof) within the Respondents (sic) control were delivered on time. An assignment agreement for all rights was not delivered on time. When I engaged legal representation it was pointed out to me that a formal document should be provided for the assignment. I had wrongly assumed that because the court had ordered the assignment and we delivered the Products, the relevant rights were assigned. … I apologise for the fact that the assignment agreement was not prepared on time. 33 His Honour referred to the fact that in Mr John Hurd's second affidavit, he had said that "the provisions of paragraph 12 of the orders have been complied with in full by a document sent to [Zomojo] on 14 March 2013". 34 The primary judge said that he considered each of the statements in the respective affidavits to be admissions which were admissible under s 81 of the Evidence Act. Each admission was only admissible against the person who had made it, although Mr John Hurd's admissions were also admissible against the companies on whose behalf he made the statements. The effect of the respective admissions was to assert that no legally effective assignment of rights occurred until after 26 February 2013. Each statement was adverse to the interests of the person making it and the persons on whose behalf it was made because it was to the effect that the order in paragraph 12 of the orders had not been complied with. His Honour found that the failures constituted a deliberate and voluntary contravention of the order in paragraph 12 and that the charges against each of the appellants had been proved. He also found the charge proved against each of Zeptonics, Crosswise, Zepto Markets and Zepto Fabrics.

Paragraph 14 35 The primary judge noted that Zomojo alleged that each of the appellants had failed to deliver up all documents in their possession which were comprehended by the order in paragraph 14. Although some documents had been produced, other documents, such as internal e-mails, communications with investors, patent applications, bank statements and financial accounts, had not been provided to Zomojo. 36 His Honour noted that in relation to the order in paragraph 14, Zomojo's case relied on admissions made by Mr Matthew Hurd and Mr John Hurd. 37 His Honour referred to the following passage in Mr Matthew Hurd's affidavit: I believe the Respondents were in full compliance by 14 March 2013. I know that my staff provided many documents by 26 February 2013. A substantial number of documents were not delivered. Over twenty five thousand further documents were provided after 26 February 2013 that were hand delivered … to Zomojo's … Office … I apologise to the court that the delivery of these documents was not timely and the majority of the documents were delivered after the [statement of charge had been filed and served]. 38 His Honour referred to the fact that in Mr John Hurd's second affidavit, he said that the provisions of paragraph 14 "were complied with in full by the 14th [of] March 2013". 39 His Honour said that he considered that each of the statements were properly treated as admissions which were admissible under s 81 of the Evidence Act. Mr Matthew Hurd's statement was admissible only against him and in it he expressly admitted that he had not fully complied with the order in paragraph 14 by 26 February 2013. Mr John Hurd's statement was admissible only against him and the companies on whose behalf he made it. His Honour said that Mr John Hurd's statement that full compliance did not occur until 14 March 2013, "in context, necessarily implies that there had not been full compliance by 26 February 2013" (at [79]). 40 The primary judge said that each statement was adverse to the interests of the person making it and the persons on whose behalf it was made because it acknowledged that the order in paragraph 14 had not been complied with by 26 February 2013. The failures constituted a deliberate and voluntary contravention of the order in paragraph 14, and the charges against each of the appellants had been proved. He also found the charge proved against each of Zeptonics, Crosswise, Zepto Markets, Trademach, Zepto Fabrics and Zeptoip.

Paragraph 15 41 The particulars of this charge related to "ZeptoAccess KRX" units provided under service agreements with three firms. The primary judge found the charge proved with respect to only one of the three firms, and for the purpose of these appeals, we can concentrate on that service agreement. 42 The gravamen of the charge was that, on 17 October 2011, Zeptonics had entered into a software licensing agreement ("licensing agreement") with Leading Investments and Services Co Ltd ("Leading Investments"). Zeptonics was established by Mr Matthew Hurd in January 2010 and he had negotiated the licensing agreement with Leading Investments. The primary judge found that it was a term of the agreement that Zeptonics had the power to terminate the licensing agreement if the use of the KRX units was to be prohibited "by a temporary injunction or a legally binding decision". Zomojo alleged that Zeptonics should have terminated the agreement and that the failure to do so meant that each of the appellants had facilitated or enabled Leading Investments to continue to access or use one of the products in contravention of the order in paragraph 15. 43 The primary judge referred to the following passage in Mr Matthew Hurd's affidavit: Two Korean brokers, NewEdge Korea and Leading Investment and Securities, were running the ZeptoAccess KRX system in Korea on 5 February 2013. One Korean broker, Hyundai Futures, was having the ZeptoAccess KRX system installed prior to 5 February 2013. My staff and I stopped work on any support and any installation activity related to ZeptoAccess KRX from 5 February 2013. … I believe there was no legal action we could take to force a return or to disable the systems in foreign jurisdictions. It would have been an illegal action for my staff or me to reach into a Korean broker's production financial system and interfere with their system. 44 His Honour noted that Mr Matthew Hurd was a director of Zeptonics at relevant times. His Honour said that Mr Matthew Hurd's statement was admissible against him as an admission. He found that as a director of Zeptonics, Mr Matthew Hurd could have, but did not, take steps under the licensing agreement with Leading Investments to prevent the licensee from continuing to use ZeptoAccess KRX. His failure to do so was a deliberate and voluntary contravention of the order in paragraph 15 and the charge against Mr Matthew Hurd had been proved. The charge had also been proved against Zeptonics. 45 His Honour found that the charge of a contravention of the order in paragraph 15 had not been proved against Mr John Hurd.

Paragraph 16 46 Zomojo's case against Mr John Hurd was that he had aided and abetted or otherwise caused a contravention of the order in paragraph 16 by Zeptonics. 47 The primary judge referred to a number of findings made by Gordon J in the substantive judgment. They were as follows: (1) Zeptonics was the corporate entity through which Mr Matthew Hurd had developed and marketed certain products, including ZeptoLink; (2) The Leading Agreement referred to in the order in paragraph 16 is the same agreement referred to above ([at 42]); (3) Mr Matthew Hurd designed, developed and marketed the product known as ZeptoLink during his employment by Zomojo and thereafter. 48 His Honour noted that Gordon J made a declaration that Zeptonics held the profits it had derived by reason of its development and marketing of ZeptoLink and its entry into the agreement with Leading Investments as constructive trustee for the benefit of Zomojo and was liable to account to Zomojo for those profits. 49 The primary judge noted that at relevant times, Mr John Hurd was the sole director of Zeptonics. 50 In his first affidavit, Mr John Hurd said on behalf of Zeptonics, that "there are no profits to be deposed" in relation to Zeptonics. He sought to support that statement by reference to financial statements of Zeptonics which were attached to his first affidavit. Those financial statements were a balance sheet as of June 2012, a profit and loss statement from July 2011 to June 2012, a balance sheet as of November 2012, and a profit and loss statement from July 2012 to November 2012. None of those documents specifically identified profits in relation to the Leading Agreement referred to in the order in paragraph 16. In his second affidavit, Mr John Hurd said on behalf of Zeptonics, that "the provisions of paragraph 16 of the orders were complied with in full on the 14th [of] March 2013". 51 The primary judge noted that Zomojo contended that Mr John Hurd and Zeptonics had contravened paragraph 16 in two ways. First, the affidavits had not contained evidence relating to all profits derived by Zeptonics from the licensing agreement with Leading Investments. Secondly, and in any event, the attempt to comply with the order had been made belatedly. 52 His Honour said that he accepted these submissions. As to the first matter, he said that neither affidavit contained any material which might reasonably be regarded as being comprehended by the order. The financial statements were deficient in that they did not provide any specific information relating to the profits derived by Zeptonics from its licensing agreement with Leading Investments, they did not deal specifically with revenue generated by the marketing of ZeptoLink units, and they related to only part of the period during which the licensing agreement was in force. As to the second matter, the primary judge noted that both of Mr John Hurd's affidavits post-dated 26 February 2013. 53 A contravention of the order in paragraph 16 had been proved against Mr John Hurd. The charge had also been proved against Zeptonics.

Paragraph 17 54 Zomojo's case was that Mr John Hurd aided and abetted or otherwise caused a contravention of the order in paragraph 17 by Crosswise. 55 Again, the primary judge referred to a number of findings made by Gordon J in the substantive judgment. They were as follows: (1) Crosswise was a company established by Mr Matthew Hurd and the entity through which he solicited and obtained investors and marketed and developed the Crosswise ATS product; (2) Mr Matthew Hurd developed the Crosswise ATS using his knowledge of a similar product which had been devised by Zomojo; (3) Mr Matthew Hurd conceived or invented the Crosswise ATS using this knowledge during his period of employment by Zomojo; (4) Mr Matthew Hurd actively marketed the Crosswise ATS after leaving Zomojo. 56 His Honour noted that Gordon J made a declaration that Crosswise held the profits it had derived by reason of its fundraising, marketing and development of the Crosswise ATS as constructive trustee for the benefit of Zomojo and was liable to account to Zomojo for those profits. 57 The primary judge referred to the statement in Mr John Hurd's first affidavit that Crosswise Pty Ltd had "no profits to be deposed" and the financial statements of Crosswise Pty Ltd attached to his affidavit. Those financial statements were a balance sheet as at June 2011, a balance sheet as at June 2012, a profit and loss statement from January 2011 to June 2011, and a profit and loss statement from July 2011 to June 2012. His Honour noted that none of these documents specifically identified profits in relation to the development, marketing and sales of the Crosswise ATS. His Honour noted that there was no specific mention made in any of the financial statements of Crosswise Pty Ltd to income and expenditure relating to the Crosswise ATS product. 58 The primary judge also referred to the statement in Mr John Hurd's second affidavit that "the provisions of paragraph 17 of the orders were complied with on the 27th February 2013 and there was further confirmation by separate affidavit on the 11th March 2013". 59 The primary judge said that he accepted Zomojo's submissions that Mr John Hurd and Crosswise had failed to make any bona fide attempt to comply with the order in paragraph 17 and that such attempt as has been made was made after the prescribed time had passed. The primary judge explained what he meant by this. He said that the financial statements attached to Mr John Hurd's first affidavit did not provide information relating to profits (or lack of them) derived by Crosswise which could be attributed to its Crosswise ATS product. The order in paragraph 17 required Crosswise to provide information relating to all profits derived by the company from the development, marketing and sale of the Crosswise ATS product and Gordon J found that such development, marketing and sales had occurred. No attempt was made to provide financial details in relation to these matters and the documents which were filed in purported compliance with the order in paragraph 17 related to the general financial affairs of Crosswise. The primary judge also said that the financial statements related to part only of the period during which the development, marketing and sale of Crosswise ATS had occurred. 60 A contravention of the order in paragraph 17 had been proved against Mr John Hurd. The charge had also been proved against Crosswise.

Paragraph 18 61 Zomojo's case was that Mr John Hurd aided and abetted or otherwise caused a contravention of the order in paragraph 18 by Zepto Markets. 62 Again, the primary judge referred to a number of findings made by Gordon J in the substantive judgment. They were as follows: (1) Mr Matthew Hurd had been an employee of Zomojo until 11 February 2011 and he had been Zomojo's co-managing director, a director and company secretary; (2) Mr Matthew Hurd in those capacities had been involved in the development of certain products which were later to become the ZeptoAccess KRX; (3) Two days before he left Zomojo, Mr Matthew Hurd sent an email with an attached sheet entitled "Zeptonics" to SunGard Global Trading (Singapore) Pte Ltd ("SunGuard"); (4) Products being developed by Zeptonics (which had been established by Mr Matthew Hurd before he left Zomojo) were identified and they included the forerunners of ZeptoAccess KRX. Mr Matthew Hurd had established Zeptonics during his employment by Zomojo. Products, including the forerunners of ZeptoAccess KRX, had been identified; (5) On 20 April 2011, Mr Matthew Hurd caused Zepto Markets (then called Zepto DMA) to be incorporated and Mr Matthew Hurd was its sole director and shareholder until 22 February 2012; (6) On 8 June 2011, Zepto Markets and SunGard entered into the "SunGard Agreement" and under the agreement, Zeptonics was to provide services to SunGuard; (7) Zepto Markets was engaged in the business of marketing and selling Zeptonics' gateway products, such as ZeptoAccess KRX, to professional traders and institutions; (8) Mr Matthew Hurd had caused Zepto Markets to enter into the SunGuard Agreement and offered advice and assistance to SunGuard. 63 His Honour noted that Gordon J made a declaration that Zepto Markets held the profits it had made by reason of its marketing and sale of ZeptoAccess KRX as constructive trustee for the benefit of Zomojo, and was liable to account to Zomojo for those profits. 64 The primary judge referred to statements in Mr John Hurd's first affidavit to the effect that there were "no profits to be deposed" and that he referred to financial statements of Zepto Markets attached to his affidavit. Those financial statements were a balance sheet as at June 2012 and a profit and loss statement from July 2011 to June 2012. His Honour said that the financial statements contained no specific mention of income and expenditure relating to the ZeptoAccess product. The primary judge referred to a statement in Mr John Hurd's second affidavit that paragraph 18 "[was] complied with in full on the 14th [of] March 2013". 65 As with the order in paragraph 17, the primary judge said that he accepted Zomojo's submissions that Mr John Hurd and Zepto Markets (incorrectly referred to in this part of his Honour's reasons (at [115]) as ZeptoAccess) had not made any bona fide attempt to comply with paragraph 18, and that such attempt as had been made was made after the prescribed time had passed. His reasons for this view were, in substance, the same as they were in relation to the order in paragraph 17. 66 A contravention of the order in paragraph 18 had been proved against Mr John Hurd. The charge had also been proved against Zepto Markets.

Paragraph 19 67 Zomojo's case was that Mr John Hurd aided and abetted or otherwise caused a contravention of the order in paragraph 19 by Zepto Fabrics. 68 The primary judge referred to Mr John Hurd's first affidavit in which he said that there were no profits to depose to as Zepto Fabrics had never commenced business and had no financial accounts. He also referred to Mr John Hurd's second affidavit in which he said that paragraph 19 of the orders "were complied with on 27th [of] February 2013". 69 The primary judge referred to findings made by Gordon J in the substantive judgment. They were as follows: (1) Mr Matthew Hurd had developed and marketed the product which came to be known as ZeptoLink while he was in the employ of Zomojo; (2) After leaving Zomojo's employ, he had engaged in the further design and development of ZeptoLink and had marketed the product; (3) Mr Matthew Hurd had established Zepto Fabrics on 7 March 2012 for the purpose, inter alia, of exploiting the ZeptoLink product. 70 His Honour noted that Gordon J made a declaration that Zepto Fabrics held the profits it had derived by reason of its exploitation of ZeptoLink as a constructive trustee for the benefit of Zomojo and was liable to account to Zomojo for those profits. 71 The primary judge said that he accepted Zomojo's submissions that Mr John Hurd and Zepto Fabrics had failed to make any bona fide attempt to comply with the order in paragraph 19, and that such attempt as had been made was made after the prescribed time had passed. 72 His Honour said that, in light of Gordon J's findings and holdings, the "dismissive" statement made by Mr John Hurd in his first affidavit was a "wholly inadequate" response to the order in paragraph 19. His Honour said that if Zepto Fabrics had never traded (as Mr John Hurd asserted) then, at the very least, how it came about that the company established by Mr Matthew Hurd for the purpose of exploiting ZeptoLink had not pursued the intended course, should have been explained. Mr John Hurd, as the director of Zepto Fabrics, must be taken to have possessed the relevant knowledge. 73 A contravention of the order in paragraph 19 had been proved against Mr John Hurd. The charge had also been proved against Zepto Fabrics.

Paragraph 20 74 Zomojo's case was that Mr John Hurd aided and abetted or otherwise caused a contravention of the order in paragraph 20 by Zeptoip. 75 The primary judge referred to the statement in Mr John Hurd's first affidavit that there was no profits to depose to as Zeptoip had never commenced business and had no financial accounts. He also referred to the statement in Mr John Hurd's second affidavit that paragraph 20 "was complied with on the 27th [of] February 2013". 76 His Honour referred to two findings made by Gordon J in the substantive judgment. They were as follows: (1) Mr Matthew Hurd arranged for the incorporation of Zeptoip on 7 March 2012 for the purpose of holding Zeptonics' intellectual property, including patents and trademarks; (2) Mr Matthew Hurd caused Zeptoip to file a patent application relating to what he called "negative latency" but which she held "was in fact an implementation of Zomojo's fast ordering, speculative transmission and transmit fragmentation techniques". 77 His Honour noted that Gordon J made a declaration that Zeptoip held the profits it had derived by reason of its assistance, its lodgement or holding of any patents concerning Zomojo's confidential information as constructive trustee for the benefit of Zomojo and was liable to account to Zomojo for those profits. 78 The primary judge said that he accepted Zomojo's submissions that Mr John Hurd had failed to make any bona fide attempt to comply with the order in paragraph 20, and that such attempt as had been made was made after the prescribed time had passed. He said that Mr John Hurd's statement that Zeptoip had never commenced business "did not sit comfortably" with Gordon J's findings and his response was inadequate. As a director, he was able to explain how it was that Zeptoip's activities had not been profitable despite its entry into the intellectual property field which, it may be assumed, involved expenditure. This he failed to do. 79 A contravention of the order in paragraph 20 had been proved against Mr John Hurd. The charge had also been proved against Zeptoip.

Paragraph 21 80 Zomojo's case was that Mr John Hurd aided and abetted or otherwise caused the contravention in paragraph 21 by Trademach. 81 The primary judge referred to Mr John Hurd's statement in his first affidavit that there were no profits to depose to as Trademach had never commenced business and had no financial accounts. In his second affidavit, Mr John Hurd said that paragraph 21 "was complied with on 27th [of] February 2013". 82 The primary judge referred to three findings made by Gordon J in the substantive judgment. They were as follows: (1) Mr Matthew Hurd established Trademach on 14 February 2012; (2) In March 2012, Trademach started conducting test trades on a Korean futures and options exchange; (3) Trademach entered into a licence agreement with Leading Investments. 83 His Honour noted that Gordon J made a declaration that Trademach held the profits it had derived by reason of its entry into the licensed trading agreement as constructive trustee for the benefit of Zomojo and was liable to account to Zomojo for the profits. 84 The primary judge said that, plainly, Gordon J contemplated that Trademach had derived profits under the agreement. 85 The primary judge said he accepted Zomojo's submissions that Mr John Hurd had failed to make any bona fide attempt to comply with the order in paragraph 21, and such attempt as had been made was made after the prescribed time had passed. He described Mr John Hurd's response as "wholly inadequate and dismissive". He said that the assertion that Trademach had never commenced business did not "sit comfortably" with Gordon J's findings about it having entered into the agreement and undertaken test trades. His Honour said that if the true position was, as he appeared to suggest that Trademach had derived no profits with its agreement with Leading Agreement, it was necessary for him to explain why it was that the licensing arrangements had proven to be unprofitable. As a director of Trademach, Mr John Hurd was in a position to respond appropriately to the order in paragraph 21. 86 A contravention of the order in paragraph 21 had been proved against Mr John Hurd. The charge had also been proved against Trademach.

Relevant Principles and Three Arguments 87 The appellants raised three matters which require an examination of the relevant principles. 88 This Court's power to punish for contempts of its power and authority is contained in s 31(1) of the Federal Court of Australia Act. The power is the same as that of the High Court to punish for contempts of that Court. The High Court's power is the same as that of the Supreme Court of Judicature in England at the commencement of the Judiciary Act (Judiciary Act 1903 (Cth) s 24). 89 An application by a party who alleges a contempt of court is governed by Division 42.2 of the Rules. The application must be made by an interlocutory application, and it must be accompanied by a statement of charge and the affidavits on which the person making the charge intends to rely to prove the charge (r 42.12). Service and the procedure on the hearing are dealt with in rr 42.13 and 42.15 respectively. The enforcement of judgments and orders of the Court are dealt with in Part 41 of the Rules. If non-compliance with an order may result in "committal, sequestration or punishment for contempt", then there must be an appropriate endorsement on the order (r 41.06). Rule 41.08(2) deals with the potential liability of a director of a corporation or an organisation where the corporation or organisation is in default and provides that a party may apply for the committal of an officer of the corporation or organisation. 90 Historically, there was a well-established distinction between civil and criminal contempts. In Australian Meat Industry Employees' Union and Others v Mudginberri Station Pty Ltd (1986) 161 CLR 98, the High Court decided that a court could impose a fine for a contempt where there was a deliberate commission or omission which was in breach of an injunctive order or an undertaking unless the respondent's conduct was casual, accidental or unintentional. Gibbs CJ, Mason, Wilson and Deane JJ put the matter in the following way (at 113): In our view the reasons supporting the recent decisions are compelling and they should be accepted by this Court. It follows that a deliberate commission or omission which is in breach of an injunctive order or an undertaking will constitute such wilful disobedience unless it be casual, accidental or unintentional. ... This conclusion disposes of the appellants' submission that there is no power to fine, because it is plain that the appellants' non-compliance with the interlocutory injunction was wilful and not casual, accidental or unintentional. ... 91 It is important to bear in mind that a direct intention to disobey an order is not a necessary element in a finding of wilful disobedience or a deliberate commission or omission in relation to an order. In other words, a contempt may be made out even where there is no intention to disobey an order or knowledge that acts or omissions were in breach of an order. Where that intention or knowledge is proved, the disobedience amounts, in all likelihood, to a criminal contempt (Miller CJ, Contempt of Court (3rd ed, Oxford University Press, 2000) at [14.52]; Borrie and Lowe, The Law of Contempt (4th ed, Lexis Nexis, 2010) at [6.10]). 92 The elements of a contempt charge, whether it be civil or criminal, must be proved beyond reasonable doubt: Witham v Holloway. 93 A person, other than a person to whom the order is directed, may be found guilty of contempt in connection with a contravention of the order. We have already referred to r 41.08(2) of the Rules and the potential liability of an officer of a corporation to committal. In addition, a third party may be guilty of contempt if they know of the order and aid and abet the respondent in contravening it or otherwise do an act that obstructs or frustrates the object of the order (Miller (2000) at [14.60]-[14.65]; Borrie & Lowe (2010) at [6.13]-[6.17]). In certain cases, the liability of the third party is direct and not as an accessory (Zhu v Treasurer of the State of New South Wales (2004) 218 CLR 530 at 571-572 [121]). 94 The three matters raised by the appellants were as follows. First, Zomojo was required to prove beyond reasonable doubt that the appellants did not act in good faith and it failed to prove this. Secondly, Zomojo was required to prove beyond reasonable doubt that the appellants' conduct was not casual, accidental or unintentional and it had failed to do this. Thirdly, the primary judge had not explained the basis of Mr John Hurd's liability and, had he addressed the matter, he would have exonerated Mr John Hurd. 95 The first argument must be rejected because the law does not require Zomojo to prove that the appellants were not acting in good faith. We assume that good faith is a reference to a state of mind. 96 It is true that in parts of his reasons the primary judge referred to whether Mr John Hurd and the relevant company concerned had made a bona fide attempt to comply with the order (paras 106, 115, 121, 128 and 135). However, we do not think his Honour was referring to Mr John Hurd's state of mind. In our opinion, his Honour was simply using the expression "bona fide attempt" as a characterisation of what had occurred. In a case where a party has responded to an order, the extent of the compliance may be relevant in that the Court may decline to exercise its contempt jurisdiction where there has been substantial compliance or compliance other than in technical respects. His Honour was using "bona fide attempt" to characterise the difference between what was required and what had occurred. 97 As to the second argument, the Court did not have the benefit of detailed submissions, and we hesitate to express a concluded view. In terms of the authorities to which the Court was referred, there appear to be two different approaches. 98 In Advan Investments v Dean Gleeson Motor Sales, Gillard J said that while the prosecutor had to prove beyond reasonable doubt that the conduct was deliberate and voluntary, it did not have to negate the possibility that it was casual, accidental or unintentional. His Honour said (at [44], [45], and [51]): The English position is summarised in a leading Text, "Contempt of Court" by C. J. Miller (3rd Edition), where the learned author says at p. 657 - ... a civil contempt will usually require no more than proof of an intentional act or a bare omission which is in breach of it. The obligation to comply with the order is in this sense strict. An intention to disobey it is unnecessary and any additional element of mens rea is relevant only as to the penalty to be imposed. Nonetheless, it seems that liability for civil contempt (and not simply one which is deserving of punishment) will be negated where the act alleged constituted a contempt is itself accidental and unintentional. In my opinion, save for the last sentence, what the learned author says is the law in this State. The last sentence reflects the English Rules of Court. In my opinion, it would not be a defence to a contempt proceeding to show that the disobedience came about by some casual or accidental and unintentional act. Putting it around the other way, it is not part of the prosecution's proof once the matter is raised to establish that the breaching act or omission was something that was not casual or accidental and was intentional. However, in my opinion if the evidence revealed that the breach was casual or accidental and unintentional, that would be relevant to whether or not this court should exercise its contempt jurisdiction and, on any view, is relevant to the question of penalty if the court comes to the view that it should exercise the jurisdiction. In my opinion, the plaintiff must establish that the contemnor had knowledge of the terms of the order and that he deliberately committed an act or omitted to do some act which had the effect of breaching the order. Unless the terms of the order require otherwise, the plaintiff does not have to prove that the act or omission constituting the breach was accompanied by an intention to deliberately breach the order. 99 By contrast, Tracey J said in Textile Clothing and Footwear Union of Australia v Morrison Country Clothing Australia Pty Ltd [2008] FCA 604 ("Textile Clothing and Footwear Union of Australia") at [40]-[41]: In Australian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 Gibbs CJ, Mason, Wilson and Deane JJ said (at 112-113) that: …lying behind punishment for a contempt which involves wilful disobedience to a court order, is the very substantial purpose of disciplining the defendant and vindicating the authority of the court. … a deliberate commission or omission which is in breach of an injunctive order or an undertaking will constitute such wilful disobedience unless it be casual, accidental or unintentional. It is clear that Mr Morrison's affidavit does not, in terms, comply with the Order. A breach of an order will be considered deliberate if it is not found to be casual, accidental or unintentional. The onus remains on the party seeking to prove the contempt to prove that the alleged contemnor's conduct is not casual, accidental or unintentional. 100 We do not need to choose between the two views in this case because, even following the view of Tracey J in Textile Clothing and Footwear Union of Australia, Zomojo established the necessary "mental" element of the charges. This is not a case where it is necessary to give consideration to casualness, in the relevant sense of accidental, or so irregular as to be insignificant or accidental (The Concise Oxford Dictionary (8th ed, Clarendon Press, 1990) p 175). Nor does "accidental" arise. The appellants placed emphasis on the "unintentional" limb of the phrase and submitted by way of example that partial compliance coupled with an apology meant that any alleged contravention was unintentional. It seems to us that that is to give "unintentional" a meaning that it does not bear. As we have already said, there is no requirement that an alleged contemnor intended to breach the order. To take a somewhat extreme example, it is clear that a person may be guilty of civil contempt even though they were acting on legal advice (see, for example, Miller (2000) at [14.52]). 101 We are satisfied that the conduct in this case was not casual, accidental or unintentional in the relevant sense and, therefore, was deliberate and voluntary as found by his Honour. 102 The third argument must be rejected. In Australian Competition and Consumer Commission v Goldstar Corporation Pty Ltd [1999] FCA 585, Kiefel J, when a judge of this Court, said (at [41]-[42]): Directors who have notice of a Court order (as to which see Madeira v Roggette, 364) are under a duty to take reasonable steps to ensure that it is obeyed, and if they wilfully fail to do so and the Order is breached they may also be held liable for contempt: Attorney-General for Tuvalu v Philatelic Distribution Corporation Ltd [1990] 1 WLR 926, 336. As the judgment there shows, it may be a defence that the director reasonably believed some other director or officer was taking those steps. Omission may also suffice for a finding of contempt since a failure to supervise, investigate, "or wilful blindness" on the part of a director may qualify the conduct as contemptuous: A-G for Tuvalu, 938. Mr Hudson defends these charges principally on the basis that he relied upon Mr McMillan in ascertaining the extent of Goldstar's obligations and that he took all reasonable steps to bring the terms of the Order to the attention of staff. 103 The appellants submitted that the primary judge did not address in his written reasons the question of whether Mr John Hurd was knowingly involved in the contraventions. There was a reference to this issue in the appellants' closing submissions to the primary judge, and at one point his Honour asked how it could be said that, if a company could only act through one person, that person was not involved in the contravention. Nevertheless, it is true that his Honour did not discuss the issue in his written reasons. However, on a number of occasions in his written reasons, he refers to Mr John Hurd as the sole director or a director of one or more of the corporate respondents (for example, [70, [90], [97]) and to the fact that Mr John Hurd swore his affidavits on behalf of the corporate respondents. It seems that the primary judge considered those facts to be sufficient to make him liable for aiding and abetting or otherwise causing the contraventions. 104 Mr John Hurd was the sole director of the corporate respondents at the relevant time. If the companies were to comply or fail to comply it was because of his conduct or inaction. He swore his first affidavit on behalf of those companies (and others) to deal with compliance with paragraphs 16 to 21 inclusive by those companies of which he was the sole director. He swore his second affidavit in support of compliance with the orders. We think he was liable in relation to contraventions by the corporate respondents because he assisted or procured the contraventions.

Further Issues on the Appeals 105 Mr Matthew Hurd and Mr John Hurd were represented by counsel before the primary judge. Before this Court, each appeared in person. There are 16 grounds of appeal, one of which (ground 15) is not pressed. Some of the grounds of appeal can be dealt with individually; others are better dealt with together and in the course of considering particular findings made by the primary judge.

Ground 1 106 The appellants contend that his Honour erred in giving Zomojo leave to re-open its case and tender affidavits without notice, and in dispensing with (if his Honour did dispense with) r 42.12(b) of the Rules. 107 The affidavits referred to in this ground of appeal are the second affidavit of Mr John Hurd and the affidavit of Mr Matthew Hurd ("the Hurd affidavits"). We put to one side, for consideration later in these reasons, whether the statements in the affidavits were admissible in evidence as admissions. 108 The appellants submitted that their affidavits should not have been received because they were not served with the charges as required by r 42.12(b) of the Rules. 109 The appellants made a similar submission to his Honour about the admission in evidence of Ms Whiting's second affidavit. His Honour admitted the affidavit for reasons we have identified (at [23], [24]). The appellants repeated their complaint about the admission of Ms Whiting's second affidavit on the appeal. However, their complaint must be rejected because his Honour was correct for the reasons which he gave. The Court has a discretion to receive further affidavits despite the fact that they were not served with the charges, and there is nothing to suggest that his Honour's exercise of the discretion miscarried in relation to Ms Whiting's second affidavit. 110 Although his Honour did not address r 42.12(b) in the context of the Hurd affidavits in his written reasons, it is clear that he considered that he had a discretion for the same reasons he gave in relation to Ms Whiting's second affidavit. Subject to the other substantive points raised by the appellants (which are addressed below), there is no reason to think his Honour's exercise of the discretion miscarried. In fact, in the case of the Hurd affidavits because of when they were sworn, they could not have been served with the charges. Another relevant consideration in favour of admission was the fact that the affidavits were sworn by the appellants themselves. 111 The appellants submitted that the primary judge erred in allowing Zomojo to re-open its case. They submitted that the contempt charges were akin to criminal proceedings and they referred to the prosecution's limited right to re-open its case in criminal proceedings. The appellants also submitted that his Honour did not deliver reasons for his decision to allow Zomojo to re-open its case despite saying that he would do so. 112 The appellants' submissions must be rejected. The primary judge had a discretion to allow Zomojo to re-open its case. The exercise of the discretion did not miscarry, particularly as the appellants had not opened their case at the time he allowed Zomojo to re-open its case. His reasons appear in the transcript and he expanded on those aspects of his ruling which he considered he needed to in his written reasons. For example, in his written reasons he gave reasons for his conclusion that certain statements were admissions. The first ground of appeal must be rejected.

Grounds 2 and 7 113 The appellants contend that his Honour erred in failing to reject the evidence in the Hurd affidavits under s 135 or s 137 of the Evidence Act. They also contend that he erred in failing to take into account, or failing to take proper account of, the appellants' right to silence. 114 The appellants relied on a number of submissions in support of these contentions. First, they submitted that his Honour's decision to allow Zomojo to re-open its case meant that they had to make a decision about how they would present their case "on the hop". We reject this submission. Leaving aside other matters which might be raised in answer to it, the primary judge made it clear to counsel for the appellants that he would be given time to consider how the appellants wished to proceed. Secondly, the appellants relied on the alleged non-compliance with r 42.12(b). We have already dealt with that submission. Thirdly, the appellants submitted that the admission in evidence of their respective affidavits in some way impinged on their privilege against self-incrimination. Before the primary judge, this issue appears to have been raised only in relation to Mr John Hurd, but we will address it in relation to both appellants. The primary judge rejected the submission in relation to Mr John Hurd for reasons with which we agree. Mr John Hurd made no claim for privilege when he swore his affidavits, and whether he could have done did not need to be decided. The privilege was lost once the affidavits were filed (O Limited v Z [2005] EWHC 238 at [64]; R v Australian Broadcasting Tribunal; Ex parte Hardiman (1980) 144 CLR 13 at 33-34). 115 A related matter was a submission by the appellants that it was unclear as to whether the Court below had admitted in evidence Mr John Hurd's first affidavit. We think that it is clear that the Court did receive the affidavit (at [18]) and, in our opinion, it was admissible on a number of grounds. It is sufficient to note that it was admissible as the affidavit sworn by the proper officer of the corporate respondents in response to the orders made on 5 February 2013. 116 The second and seventh grounds of appeal must be rejected.

Grounds 3, 4, 5, 6, 8, 9, 10, 11, 12 and 13 117 These grounds raise the following contentions: (1) The primary judge failed to take into account the whole of the affidavit evidence in deciding that the conduct of each of the appellants was not in good faith, whether it was casual, inadvertent or accidental, or whether it was a genuine attempt to comply with the relevant paragraphs; (2) The findings made by Gordon J in the substantive judgment were relied on by the primary judge. However, these findings were made on the balance of probabilities whereas the contempt charges had to be proved beyond reasonable doubt; (3) The primary judge erred in concluding that statements by Mr John Hurd that the corporate respondents made no profits were admissions; (4) The primary judge erred in not finding that the appellants were under no obligation to meet or respond to evidence tendered by Zomojo; (5) The primary judge erred in finding that Mr John Hurd was knowingly involved in the breach of the paragraphs or failed to give adequate reasons for that finding; (6) The primary judge ought to have found in the case of each appellant that the breaches were casual, accidental or inadvertent or, in the alternative, Zomojo had not proven beyond reasonable doubt that they were not; and (7) The primary judge erred in his interpretation of the paragraphs, or in finding what was required to comply with the orders, or ought to have held the paragraphs were not clear and capable of compliance. 118 We make two observations. First, we have already dealt with a number of these matters (i.e., the relevance of good faith, of whether conduct was casual, accidental or unintentional and the basis of Mr John Hurd's liability). Secondly, some of the appellants' contentions state or imply that his Honour did something which in fact he did not do. We will elaborate on this below. It is necessary to consider the appellants' contentions in the context of each particular order.

Paragraph 12 119 Mr Matthew Hurd was one of the respondents referred to in the orders in paragraph 12 and he was required to comply with the order. As we have said, the primary judge considered that the statement of Mr Matthew Hurd in his affidavit (at [32] above) was admissible as an admission under s 81 of the Evidence Act. That section provides that the hearsay rule does not apply to evidence of an admission. The admission was made in a document so it met the requirement in s 82 of the Evidence Act. An "admission" is defined in the Dictionary to that Act as follows: admission means a previous representation that is: (a) made by a person who is or becomes a party to a proceeding (including a defendant in a criminal proceeding); and (b) adverse to the person's interest in the outcome of the proceeding. A "previous representation" is defined in the Dictionary as follows: previous representation means a representation made otherwise than in the course of giving evidence in the proceeding in which evidence of the representation is sought to be adduced. 120 In our opinion, the primary judge was correct to conclude that Mr Matthew Hurd's statement was an admission that no legally effective assignment of rights had occurred until after 26 February 2013. The order in paragraph 12 required Mr Matthew Hurd (among others) to take all necessary steps within his power to assign ownership of the rights in the products named in the order to Zomojo by 4.00 pm on 26 February 2013. His statement was to the effect that he had not done that and that was adverse to his interests in the outcome of the proceeding. 121 Mr Matthew Hurd's conduct in relation to the order in paragraph 12 was deliberate and voluntary in the relevant sense. 122 Mr John Hurd was not one of the respondents referred to in the order in paragraph 12. As we have said, Zomojo alleged that Mr John Hurd had aided and abetted and otherwise caused Zeptonics, Crosswise, Zepto Markets and Zepto Fabrics to contravene paragraph 12. At relevant times, Mr John Hurd was the sole director of those companies. 123 Mr Matthew Hurd's admission was not an admission against Mr John Hurd and the corporate respondents. However, in Mr John Hurd's second affidavit, he said that the provisions of paragraph 12 had been complied with in full by a document sent to Zomojo on 14 March 2013. In our opinion, that is clearly an admission that the order in paragraph 12 had not been complied with on or before 26 February 2013. It is a statement that the order was complied with by a particular act on 14 March 2013. 124 Mr John Hurd's conduct was deliberate and voluntary in the relevant sense. 125 The challenge to his Honour's conclusions in relation to the order in paragraph 12 must be rejected.

Paragraph 14 126 Mr Matthew Hurd was one of the respondents referred to in the order in paragraph 14 and he was required to comply with the order. 127 The primary judge considered that the statement of Mr Matthew Hurd in his affidavit (at [37] above) was admissible as an admission. In our opinion, the primary judge was correct to conclude that Mr Matthew Hurd's statement was an admission that a substantial number of documents were not provided until after 26 February 2013 and that the majority of documents were not delivered before 8 March 2013. There was not complete or full compliance until 14 March 2013. That statement of non-compliance with the order in paragraph 14 was adverse to his interests in the outcome of the proceeding. 128 Mr Matthew Hurd's conduct in relation to the order in paragraph 14 was deliberate and voluntary in the relevant sense. 129 Mr John Hurd was found to have aided and abetted and otherwise caused Zeptonics, Crosswise, Zepto Markets, Trademach, Zepto Fabrics and Zeptoip to contravene paragraph 14. 130 Mr John Hurd's statement in his second affidavit that the provisions of paragraph 14 were complied with in full by 14 March 2013 was made in a context where he addressed, on behalf of the corporate respondents, compliance with the orders made on 5 February 2013. In our opinion, it was a statement that that was when compliance in full had occurred and an admission that compliance had not occurred before that date. 131 Mr John Hurd's conduct in relation to the order in paragraph 14 was deliberate and voluntary in the relevant sense. 132 The challenge to his Honour's conclusions in relation to the order in paragraph 14 must be rejected.

Paragraph 15 133 Mr Matthew Hurd was one of the respondents referred to in the order in paragraph 15 and he was required to comply with the order. 134 The primary judge considered that the statement of Mr Matthew Hurd in his affidavit (at [43] above) was admissible as an admission. In our opinion, the primary judge was correct to conclude that Mr Matthew Hurd's statement was to the effect that he had not taken any action to prevent Leading Investments from using ZeptoAccess KRX when he had the power to do so. That was an admission against his interests in the outcome of the proceeding. 135 Mr Matthew Hurd's conduct in relation to the order in paragraph 15 was deliberate and voluntary in the relevant sense. 136 The challenge to his Honour's conclusions in relation to the order in paragraph 15 must be rejected.

Paragraph 16 137 It seems to us that the terms of the order in paragraph 16 are clear, unambiguous and capable of compliance. The reference to the Leading Agreement is a reference to the agreement identified in a declaration made by Gordon J in a previous paragraph in her orders as the Software Licence Agreement between Zeptonics and Leading Investments and Services Co dated 17 October 2011. Paragraph 16 required the disclosure of the profits derived by reason of or arising out of the Leading Agreement and the precise manner of calculating the profits. That involved details of gross receipts and each expenditure allowed against those receipts. 138 Although the primary judge referred to findings made by Gordon J, we think he did so in order to explain the context in which the order was made. We do not think those findings were being used by his Honour in support of elements of the charge. In those circumstances, it is not necessary to consider at this point the appellants' submission that his Honour erred in relying on Gordon J's findings because they were made on the balance of probabilities rather than beyond reasonable doubt. 139 In his first affidavit, Mr John Hurd said that in respect of Zeptonics "there were no profits to be deposed" and he referred to the annexed financial statements "in verification". Those financial statements are of the company and they do not disclose profits under the Leading Agreement, including gross receipts in respect of each product supplied under the agreement, and expenditure allowed against each receipt. We think that, read in context, it is clear that Mr John Hurd was saying there were no profits of the company. He did not address the question he was required to address by the terms of the order. He might have done so, albeit indirectly, had he asserted that there were no products supplied under the Leading Agreement, or that even though there were products supplied, there were nevertheless no profits made in relation to those products. Whether the latter would have been sufficient compliance with the order need not be considered because it did not occur. 140 There was non-compliance with the order in paragraph 16, not because Mr John Hurd's first affidavit was filed and served two days late (a point not taken by Zomojo), but rather because the affidavit did not satisfy the requirements of the order. A contravention was shown without more. 141 Further, there is Mr John Hurd's statement in his second affidavit to the effect that the provisions of paragraph 16 were complied with in full on 14 March 2013 which we think is an admission that they were not complied with in full prior to 14 March 2013. 142 We mention two other matters. First, although the primary judge referred to the fact that the affidavits were sworn after 26 February 2013, we do not think that he relied on the fact that Mr John Hurd's affidavit was filed and served two days late. Secondly, we think that the primary judge was entitled to rely on the fact that the financial statements of Zeptonics advanced as verification did not cover the whole period in question. They do not address the period from November 2012 to 26 February 2013. 143 The challenge to his Honour's conclusions in relation to the order in paragraph 16 must be rejected.

Paragraph 17 144 Subject to three matters, our reasoning in relation to the order in paragraph 17 is the same as it is in relation to the order in paragraph 16. 145 The three matters are a follows. First, in the case of the order in paragraph 17, there is no admission by Mr John Hurd in his second affidavit. He asserts that the order in paragraph 17 was complied with on 27 February 2013. That makes no difference because the non-compliance may be seen from Mr John Hurd's first affidavit. Secondly, his Honour said that he accepted Zomojo's submission that Mr John Hurd and Crosswise had failed to make any bona fide attempt to comply with the order in paragraph 17. As we have already said, read in context, we do not think that his Honour was referring to a particular mental state of Mr John Hurd, but rather he was acknowledging that questions of compliance or otherwise might involve matters of degree, and that the Court might decline to exercise its contempt jurisdiction if it found that there was no more than a technical or minor non-compliance. That was not the case with the non-compliance with the order in paragraph 17. Thirdly, the primary judge referred to the fact that Gordon J had found that development, marketing and sales of the Crosswise ATS product had occurred. The submission was that the primary judge should not have relied on that fact because it was made on the balance of probabilities and not beyond reasonable doubt. We do not think we need address that point because Gordon J's finding was not essential to his Honour's reasoning. The position might be otherwise if, in his first affidavit, Mr John Hurd had said that there were no sales of the Crosswise ATS, or that there were no profits made from the sale of the Crosswise ATS. However, Mr John Hurd did not say that. 146 The challenge to his Honour's conclusions in relation to the order in paragraph 17 must be rejected.

Paragraph 18 147 Subject to the second matter referred to in connection with the order in paragraph 17 (i.e., no bona fide attempt to comply) our reasoning in relation to the order in paragraph 18 is the same as it is in relation to the order in paragraph 16.

Paragraph 19 148 The order in this paragraph raises different issues from the orders in paragraphs 16, 17 and 18. That is because in his first affidavit, Mr John Hurd said that "there are no profits to depose" because Zepto Fabrics had never commenced business and had no financial accounts. In his second affidavit, he said the order was complied with on 27 February 2013, presumably a reference to the date of the swearing of his first affidavit. 149 The primary judge considered that, in light of Gordon J's findings, Mr John Hurd's statement was dismissive and that he should have explained why Zepto Fabrics had not begun exploiting the ZeptoLink Product. 150 In our respectful opinion, the primary judge erred in taking this approach. We think that a response that the company never commenced business and has no financial accounts is a response to the order in paragraph 19. It is a statement that there were no profits within paragraph 19(a) and, in the circumstances, the requirement in paragraph 19(b) did not arise. That is not to say that a statement that there were no profits might not be in contempt of court if, in fact, the prosecutor proved beyond reasonable doubt that there were profits. However, the primary judge did not make a finding beyond reasonable doubt that there were profits. Even leaving aside the appellants' submission that Gordon J's findings were made on the balance of probabilities and not beyond reasonable doubt, the fact is that Gordon J did not make a finding that there were profits. 151 Mr John Hurd's challenge to the primary judge's declaration of a contempt of paragraph 19 must be upheld.

Paragraph 20 152 The same reasoning and conclusions apply to the order in paragraph 20 as apply to the order in paragraph 19.

Paragraph 21 153 The same reasoning and conclusions apply to the order in paragraph 21 as apply to the order in paragraph 19.

Ground 14 154 The appellants contend that the primary judge erred in not finding that the absence of an endorsement on the orders as required by r 41.06 of the Rules meant that the charges should have been dismissed. As we have said, the primary judge found that the orders made on 5 February 2013 did not bear an endorsement of the kind contemplated by r 41.06. 155 The effect of a lack of endorsement on the orders was raised in the course of submissions before the primary judge, and counsel for the appellants said he did not wish to be heard against the proposition that the lack of an endorsement did not affect the Court's power to find a contempt had been committed and to so declare. That proposition is correct. Under the previous Rules (Federal Court Rules 1979 (Cth) O 37 r 2), an endorsement was required if a person was liable to imprisonment or to sequestration of property. That did not preclude a Court from imposing a fine where there is no endorsement (Siminton v Australian Prudential Regulation Authority [2006] FCAFC 118; (2006) 152 FCR 129 at 145 [68]-[70]). In the same way the Court can make declarations even though the current Rules require an endorsement for imprisonment, sequestration of property or punishment for contempt (r 41.06). 156 The fourteenth ground of appeal must be rejected.

Ground 16 157 The final ground of appeal relates to the order his Honour made for the payment of costs. The appellants contend that his Honour erred in failing to take into account, or failing to take proper account of, the offer of compromise and Calderbank offer in making the costs order. 158 On 11 April 2013, the respondents to the contempt proceeding made an offer to compromise the contempt proceeding by payment of the sum of $100 plus costs to Zomojo. The offer was open for acceptance for 14 days after service of the offer. 159 On 19 June 2014, the primary judge heard oral submissions on the question of costs. He was aware of the offer and there is no reason to think that he did not take it into account. 160 The offer did not dictate an exercise of his Honour's discretion in a particular way. We can see no error of the required kind in his Honour's order as to costs (House v The King (1936) 55 CLR 499; Norbis v Norbis (1986) 161 CLR 513).

Conclusions 161 For these reasons, the appeal by Mr John Hurd should be allowed in part. The declaration in paragraph 8 and the order in paragraph 10 of the orders made by the primary judge on 19 June 2014 should be set aside and in lieu thereof there should be the following declaration and order: 8. The Fourth Third Party is guilty of contempt of paragraphs 12, 14, 16, 17, and 18 of the order of the Court made on 5 February 2013. 10. The First to Third and Fifth to Eighth Respondents pay the costs of the Applicant's interlocutory application dated 7 March 2013, including reserved costs, save for the costs relating to the orders sought by the Applicant against the First to Third Third Parties and the costs relating to the appointment of Rodney McKemmish. The Fourth Third Party is to pay 50% of such costs. We have reduced the costs payable by Mr John Hurd in recognition of the fact that the charges against him in relation to the orders in paragraphs 19, 20 and 21 should have been dismissed. As to Mr John Hurd's appeal, there should be no order as to costs. 162 The appeal by Mr Matthew Hurd should be dismissed and he should pay Zomojo's costs of his appeal. I certify that the preceding one hundred and sixty-two (162) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Besanko and Gilmour.

Associate: Dated: 21 October 2015 IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 528 of 2014

JUDGES: BESANKO, GILMOUR AND BEACH JJ DATE: 21 October 2015 PLACE: MELBOURNE

BEACH J: 163 I have had the considerable advantage of reading the reasons of Besanko and Gilmour JJ. 164 I agree with their exposition of the applicable principles and their reasoning and conclusions concerning the first appellant, Matthew Hurd. But I am unable to agree in their reasoning and conclusions concerning the second appellant, John Hurd (Hurd senior) as to the declarations of contempt made by Tracey J relating to paragraphs 12, 14, 16, 17 and 18 of Gordon J's orders of 5 February 2013, although I agree in their reasoning and conclusions concerning Hurd senior in relation to paragraphs 19, 20 and 21 of her Honour's orders. 165 Even though the relevant proceedings against Hurd senior involved a civil contempt, nevertheless each element had to be proved beyond reasonable doubt. The contempt proceedings against Hurd senior were only in respect of what could be described as accessorial liability concerning the relevant corporate parties' contempt of Gordon J's orders; Hurd senior was not a party to the proceedings before Gordon J. In those circumstances, what needed to be proved beyond all reasonable doubt was: (a) first, all elements of the contempt of the corporate respondents; and (b) second, the knowing and deliberate acts or omissions of Hurd senior that brought about or facilitated the impugned conduct amounting to the contempt by the corporate contemnors. 166 Here, the actus reus of the contempt by the corporate respondents was by omission. 167 The first question to consider was whether such conduct of the corporate respondents was knowing and deliberate. Whose individual state of mind was to be attributed to the corporate entities for that purpose? Strictly, corporations are mindless. Lord Thurlow in 1778 succinctly expressed the point that a corporation has "no soul to damn, no body to kick". 168 The conventional approach has been to identify the individual who was the "directing mind and will" of the corporation and to attribute that person's state of mind to the corporation. But after the injection of flexibility into that concept by Lord Hoffmann in Meridian Global Funds Management Asia Ltd v Securities Commission [1995] 2 AC 500 at 506 to 511, metaphors and metaphysics have had diminished utility. First, there are no longer the rigid categories for identifying the "directing mind and will" that may be perceived to have existed after Viscount Haldane L.C.'s use of the phrase in Lennard's Carrying Co Ltd v Asiatic Petroleum Co Ltd [1915] AC 705 at 713 and indeed after Tesco Supermarkets Ltd v Nattrass [1972] AC 153 until Meridian. Second, and relatedly, the appropriate test is more one of the interpretation of the relevant rule of responsibility or liability to be applied to the corporate entity. One has to consider the context and purpose of that rule. If the relevant rule was intended to apply to a corporation, how was it intended to apply? Assuming that a particular state of mind of the corporation was required to be established by the rule of responsibility, the question becomes: whose state of mind was for the purpose of the relevant rule of responsibility to count as the knowledge or state of mind of the corporation? (see Bilta (UK) Ltd (in liquidation) v Nazir (No 2) [2015] 2 WLR 1168 at [41] per Lord Mance JSC). The question is one of the interpretation of the relevant rule taking into account its context and purpose. Now once you have asked and answered that question and identified the individual in question, you may then apply the title of "directing mind and will". But so to proceed adds little to the analysis. The label "directing mind and will" is nebulous if not question begging. It also follows that if you use such a label, then it will have variable application even within the same corporation depending upon the particular context and function of the relevant rule of responsibility. And as soon as one admits of that variability, the advantages in using the label become illusory, except to distinguish such a person who can be identified with the corporation from a person for whose acts the corporation is merely vicariously liable (Bilta at [70] per Lord Sumption JSC). I agree with Lord Walker of Gestingthorpe NPJ who suggested that it might be better if the label "directing mind and will" was allowed to "fade away" (see Moulin Global Eyecare Trading Ltd (in liquidation) v Commissioner of Inland Revenue [2014] HKCFA 22 at [106]). 169 In the present case, and given that contempt required the establishment of the relevant state of mind of the corporate entities, who was the relevant individual of the corporate contemnors whose state of mind was to be attributed to them? The clear answer is Hurd senior. He was the sole director, he had knowledge of the orders of Gordon J and he was the person charged within the corporate entities for the responsibility for their compliance. 170 But was it proved beyond reasonable doubt that Hurd senior's failure to ensure that the corporate contemnors complied was deliberate? If that has not been proved, then there are two consequences. First, if his state of mind is the relevant mind to be attributed to the corporations, then the charges were not proved against the corporate contemnors. No other case was put against the corporations referring to any other state of mind or that the corporations' systems for compliance and any deficiencies therein made them otherwise culpable. Second, as a corollary, it could not then be established that he had the requisite state of mind as an accessory. Strictly, this is an academic point because there would on this hypothesis be no primary contravention by the corporations and hence no accessorial liability in any event. No case was put that Hurd senior could be liable for contempt without the corporate entities also being liable. 171 In my view, it was not open to find beyond all reasonable doubt that Hurd senior deliberately omitted to perform the acts required by paragraphs 12, 14, 16, 17 and 18 of Gordon J's orders. 172 The main evidence that was said to establish this state of mind were the statements by way of admission set out in Hurd senior's affidavit sworn on 18 March 2013. Those statements were to the effect that the relevant orders of Gordon J were "complied with in full", but as at dates after those prescribed by her Honour. It was said that such statements were evidence that Hurd senior had deliberately failed, or caused the relevant companies to deliberately fail, to comply with her Honour's orders by the prescribed time. 173 But there are a number of difficulties with this reasoning. 174 First, at most, Hurd senior's statements were admissions of the fact of non-compliance by the prescribed time frames. But the statements said nothing about Hurd senior's state of mind or the deliberateness thereof at the time when non-compliance arose. In the present case, one cannot infer deliberateness from the fact of non-compliance per se. Hurd senior's statements only dealt with the objective omissions. 175 Second, Hurd senior used the expression "in full". It is unclear what he intended to convey. For all one knows, and given that Hurd senior was a retired chartered accountant, he may have taken a strict and pedantic view of what had been done when matched against the orders. Alternatively expressed, there may have been substantial compliance with the orders by the prescribed time, but nevertheless some minor matter to be attended to, which explains why Hurd senior used the language that he did. In other words, a reasonable inference from the words used supported innocence. Moreover, even if there was other evidence of substantial non-compliance, his statements are not evidence that he deliberately brought this about. 176 In my view, the declarations of Tracey J against Hurd senior should be set aside and the respondent ordered to pay Hurd senior's costs (if any) of this appeal and the proceedings at first instance. I otherwise agree with the orders of Besanko and Gilmour JJ. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Beach.

Federal Court of Australia Act 1975(Cth)s 31

Federal Court Rules 1979(Cth)

(Federal Court of Australia Act 1976(Cth)s 31(1)).

(Judiciary Act 1903(Cth)s 24).

Rules (Federal Court Rules 1979(Cth)

Federal Court Rules 2011(Cth)div 42.2., r 42.12., r 41.06., rr 1.34, 41.06, 41.08, 41.09, 42.12, 42.13, 42.15

Evidence Act 1995(Cth)ss 81, 135, 137., ss 81, 82, 83, 135, 137

R v Australian Broadcasting Tribunal; Ex parte Hardiman (1980) 144 CLR 13 Siminton v Australian Prudential Regulation Authority [2006] FCAFC 118; (2006) 152 FCR 129 Tesco Supermarkets Ltd v Nattrass [1972] AC 153 Textile Clothing and Footwear Union of Australia v Morrison Country Clothing Australia Pty Ltd [2008] FCA 604 Witham v Holloway (1995) 183 CLR 525 Zhu v Treasurer of the State of New South Wales (2004) 218 CLR 530 Zomojo Pty Ltd v Hurd (No 2) [2012] FCA 1458 Zomojo Pty Ltd v Hurd (No 3) [2013] FCA 54 Borrie and Lowe, The Law of Contempt (4th ed, Lexis Nexis, 2010) Miller CJ, Contempt of Court (3rd ed, Oxford University Press, 2000) The Concise Oxford Dictionary (8th ed, Clarendon Press, 1990)

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