Microsoft Corporation v Crosslink Marketing Group

The Statutory Framework for the Application by Mr Walker and Magic Computers 11 Section 24(1) of the Federal Court of Australia Act 1976 (Cth) ("F C A Act") confers jurisdiction to hear and determine appeals from judgments of the Court constituted by a single judge. However, an appeal shall not be brought from an interlocutory judgment unless the Court or a judge gives leave to appeal (s.24(1A) F C A Act). A judgment of the Court means a judgment, decree or order whether final or interlocutory (see s.4 of the F C A Act). 12 An application for leave to appeal from an interlocutory judgment may be heard and determined by a single judge (s.25(2) F C A Act) and the Rules of Court may make provision for enabling such applications to be heard and determined. Order 52 makes such provision. An application for leave to appeal from an interlocutory judgment might be made orally upon pronouncement of the judgment or on notice of motion which must be filed, relevantly here, within seven days of pronouncement (Order 25, Rule 10). The Order was pronounced by Dowsett J on 19 August 2005. The time for filing the leave application expired on 26 August 2005. The Application was filed on 15 September 2005. However, a discretion is conferred to provide such further time as the Court or a judge may allow (Order 52, Rule 10). In determining whether to grant an extension of time the Court will have regard to the length of the delay, whether an adequate explanation has been given for the delay and whether, should an extension be granted, the prospects of success in the appeal would be sufficient to justify granting an extension of time. 13 The Application to set aside the consent orders of Lander J was made pursuant to Order 35, Rule 7. At the time of the hearing of the Application, the Orders reflecting the final disposition of the action, had not been entered. The Orders were entered on 1 September 2005. The ground of attack on the Orders by Mr Walker was and remains that the Orders were obtained by fraud. Order 35, Rule 7 is in these terms: "Order 35, Rule 7 (1) The Court may vary or set aside a judgment or order before it has been entered. (2) The Court, where it is not exercising its appellate or related jurisdiction under Division 2 of Part III of the Act, may if it thinks fit vary or set aside a judgment or order after the order has been entered where - (a) the order has been made in the absence of a party, whether or not the absent party is in default of appearance or otherwise in default and whether or not the absent party had notice of the motion for the order; (b) the order was obtained by fraud; (c) the order is interlocutory; (d) the order is an injunction or for the appointment of a receiver; (e) the order does not reflect the intention of the Court; or (f) the party in whose favour the order was made consents. (3) A clerical mistake in a judgment or order, or an error arising in a judgment or order from an accidental slip or omission, may at any time be corrected by the Court. (4) Subrule (2) shall not affect the power of the Court to vary or terminate the operation of an order by a supplementary order." 14 The Order dismissing the Application is an interlocutory order. Order 35, Rule 7 confers a discretion consistent with the power conferred by s.23 of the F C A Act to correct a misuse of the Court's process. The discretion must be exercised according to recognised authority but, as a matter of broad principle, the generality of a discretion of this kind should be preserved "so as to protect the Court's capacity to see that justice is done": Carr v Finance Corporation of Australia Ltd [No. 1] (1980-81) 147 CLR 246 per Mason J at 256. Consistent with such a view, there is no justification for imposing a rigid rule that refusal is a complete bar (Carr, supra at p.256). In that sense, the proceedings are not final but interlocutory notwithstanding that, in a practical sense, the order made by Dowsett J dismissing the motion will end the matter. 15 The draft Notice of Appeal formulated by Mr Walker relies upon three grounds in these terms: "1. Denial of Natural Justice 2. His Honour Dowsett J on an oral application for the recusation failed to give due consideration to the application 3. The Honourable Court failed to give due consideration on the merits of the Notice of Motion before it." 16 The content of those grounds is contained in Mr Walker's affidavit of 19 September 2005 and his written submissions of 25 November 2005. In summary, the elements of the grounds are these. First, because Mr Walker was refused leave to represent Magic Computers (having failed to comply with the condition imposed upon that leave by His Honour that Mr Walker produce appropriate authority from the company), Magic Computers was denied the opportunity to address argument in support of the Notice of Motion. 17 Secondly, because His Honour on the application of Microsoft's Counsel made rulings striking out a number of paragraphs of Mr Walker's affidavit on the ground that those paragraphs were either irrelevant or argumentative, both Mr Walker and Magic Computers were denied procedural fairness. Thirdly, because Microsoft had failed to provide particulars of the allegations of infringement and produce discoverable documents before the commencement of the trial, Mr Walker and Magic Computers had not been afforded procedural fairness in the conduct of the action and the trial and in determining the Application to set aside the consent orders, His Honour ought to have considered these matters further. Fourthly, even though paragraphs of Mr Walker's affidavit might be susceptible to proper objection, the affidavit ought to have been considered, read and admitted as "a whole document" and the failure to so treat the affidavit rendered the remainder of no utility in support of the Application, thus denying Mr Walker and Magic Computers procedural fairness. Fifthly, because His Honour failed to have regard to the fact that Mr Walker had previously sought to agitate the contention concerning the failure by Microsoft to provide particulars and produce documents in the course of directions hearings and prior to trial, His Honour failed to afford procedural fairness in the conduct of the Application. 18 Mr Walker makes a threshold point. He is a self-represented litigant. He conducts his own research and it simply takes time. He suffers from a medical condition for which he takes medication. He says he did his best to comply with the Rules of Court but made an error of research or judgment about the time for filing an application for leave, believing the Rules provided him with a period of 21 days to file an application. 19 There is, however, a fundamental difficulty confronting Mr Walker. Mr Walker's affidavit material and the submissions he makes are in truth an aggregation of allegations, argument, expressions of personal opinion about issues and the character of individuals, contentions and some statements of fact which, upon challenge, would almost necessarily result in adverse rulings as to admissibility. Importantly, Mr Walker's circumstances do not entitle him (or give rise to any licence) to make serious allegations in an undisciplined way. The principles of law that must be established as a matter of received orthodoxy to make good any claim and the rules of evidence that govern the admissibility of evidence against which such a claim must be tested, have evolved to protect the citizen (individual or corporate) within the framework of the rule of law. These principles and rules and adversarial method cannot simply be put to one side by reason of factors such as those identified at paragraph [18]. Notwithstanding Mr Walker's personal circumstances, his condition and his position as a self-represented litigant, he must adduce evidence in a proper form directed to the question in issue. 20 As Mr Walker would no doubt appreciate, an application of the kind he mounted before Dowsett J (particularly one centred upon an allegation of fraud) must be supported by evidence directed to the question in issue. Section 55 of the Evidence Act 1995 (Cth) makes clear that evidence that is relevant is evidence which, if accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue, in the Application. Evidence that is not relevant in this sense is inadmissible. The affidavit evidence must depose to facts probative of the allegation of fraud or probative of facts from which inferences might properly be drawn. Broad assertions or statements in the nature of submissions or expressions of opinion about either the questions in issue or, more particularly, matters not going to the question in issue are neither relevant nor admissible. Mr Walker's focus in the Application before Dowsett J had to remain upon the question in issue, that is, whether by reason of the production by Microsoft and provision to Mr Walker on 29 June 2005 of an affidavit sworn by Guy Williams on the morning of 29 June 2005, that conduct was attended by deceit on the part of Microsoft leading to obtaining the orders by fraud. 21 Moreover, an allegation of fraud is, obviously enough, an extremely serious allegation and it cannot be allowed to stand unsupported by proper evidence. In order to support the notion that a judgment ought to be set aside for fraud, an applicant must demonstrate evidence of facts which establish both the fraudulent conduct and the role of the party having the benefit of the order in that conduct, the fraudulent conduct must be "directly material" to the judgment or order obtained and the evidence of fraud must be "fresh evidence" which was not available and could not have been revealed with reasonable and proper diligence before the judgment, under attack, was pronounced: Australasian Meat Industry Employees Union v Mudginberra Station Pty Ltd (1986) 12 FCR 14; Monroe Schneider Associates (Inc.) v No. 1 Rayberem Pty Ltd (1992) 37 FCR 234; Bourke v Beneficial Finance Corp. Ltd (1993) 47 FCR 264. 22 The principles Mr Walker must satisfy are set out in the decision of the New South Wales Court of Appeal, Kirby P, Hope and Samuels JJA in Wentworth v Rogers (No. 5) (1986) 6 NSWLR 534 at p.539 and they are these: "As in all actions based on fraud, particulars of the fraud claimed must be exactly given and the allegations must be established by the strict proof which such a charge requires: Jonesco v Beard [1930] AC 298 at 301. Secondly, it must be shown, by the party asserting that a judgment was procured by fraud, that there has been a new discovery of something material, in the sense that fresh facts have been found which, by themselves or in combination with previously known facts, would provide a reason for setting aside the judgment. [His Honour, Kirby P then sets out long established authority for those propositions.] It is based upon a number of grounds. There is a public interest in finality of litigation. Parties ought not, by proceedings to impugn a judgment, to be permitted to relitigate matters which were the subject of the earlier proceedings which gave rise to the judgment. Especially should they not be so permitted, if they move on nothing more than the evidence upon which they have previously failed. If they have evidence of fraud which may taint a judgment of the courts, they should not collude in such a consequence by refraining from raising their objection at the trial, thereby keeping the complaint in reserve. Thirdly, mere suspicion of fraud, raised by fresh facts later discovered, will not be sufficient to secure a relief: Birch v Birch[1902] P130 at 136, 139; McHarg v Woods Radio Pty Ltd [1948] VLR 496 at 498; Ronald v Harper [1913] VLR 311. The claimant must establish that the new facts are so evidenced and so material that it is reasonably probable that the action will succeed. This rule is founded squarely in the public interest in finality of public litigation and in upholding judgments duly entered at the termination of proceedings in the courts. Fourthly, although perjury by the successful party or a witness or witnesses may, if later discovered, warrant the setting aside of a judgment on the ground that it was procured by fraud, and although there may be exceptional cases where such proof of perjury could suffice, without more, to warrant relief of this kind, the mere allegation, or even the proof, of perjury will not normally be sufficient to attract such drastic and exceptional relief as the setting aside of a judgment. Fifthly, it must be shown by admissible evidence that the successful party was responsible for the fraud which taints the judgment under challenge. Sixthly, the burden of establishing the components necessary to warrant the drastic step of setting aside a judgment, allegedly affected by fraud, lies on the party impugning the judgment." See also the discussion of these principles by the Full Court of the Federal Court of Australia in Monroe Schneider Associates (Inc) & Anor v No. 1 Raberem Pty Ltd & Ors (1992) 37 FCR 234 at 240 and 241 discussing the application in Australia of the principles identified by Lord Bridge in Owens Bank Ltd v Bracco [1992] 2 AC 443 at 483. 23 In Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691, the Court of Appeal, Mahoney, Clarke and Handley JJA said, in relation to consent orders, this: "These principles [the principles identified in Wentworth v Rogers (No. 5)] have not hitherto been applied, so far as I am aware, to proceedings to set aside a consent judgment. However, in my opinion they are also applicable in such a case although, for obvious reasons, it will generally be more difficult to set aside a judgment after trial. Indeed these principles merely work out in this type of case the ordinary requirements in deceit for inducement and reliance. If the judgment debtor knew that the representations were false, did not rely upon them or consented to judgment for other reasons he cannot impeach that judgment later simply because his circumstances have changed or he has changed his mind." [Handley JA at p.700] 24 It should be remembered that the allegations of fraud made by Mr Walker are directed towards the conduct of not only Microsoft but Mr Devlin SC, Mr Nase and Microsoft's instructing solicitors in the production of the relevant evidence and provision of it to Mr Walker.

The Evidence relied upon by Mr Walker 25 The evidence relied upon by Mr Walker was this. On the morning of 29 June 2005, Mr Walker was provided with an affidavit sworn by Mr Guy Williams (that day) deposing to the purchase by Williams on 23 February 2004 of a computer from Magic Computers (which company Williams had known for some time). Williams says the computer was delivered by Magic Computers to his house by Mr Adrian Stevens. When Williams activated the computer and opened the CD burner, he found a CD copy of Microsoft "Windows 2000 Professional". Mr Williams had not purchased the software as part of the computer. There was no manual nor a Microsoft "Certificate of Authenticity" and the CD exhibited printing on the disk on paper which suggested that the CD was not a genuine Microsoft CD. The affidavit of Williams exhibited documents evidencing the purchase. 26 Mr Walker says that he was shown the CD and provided with a document asserting infringing sales to Stevenson, Taylor, Williams, Collins, Gava and Moes, after the settlement. Mr Walker deposes to a denial of the supply of infringing software to those individuals. He says that in the week following the settlement he spoke with Adrian Stevens who denies the allegation in the Williams affidavit concerning him. Mr Walker says the CD shown to him after the settlement was owned by Mr Peter Bryson (a man unrelated to either Mr Walker or Magic Computers in any way) and Bryson produced the infringing CD. Moreover, says Mr Walker, Bryson orchestrated the formulation of the Williams affidavit. Mr Walker deposes to investigations he made about Bryson and Bryson's conduct concerning other individuals and a misleading brochure Bryson produced about the sale of computers. Mr Walker asserts that Bryson was the main witness for Microsoft and was, by his conduct, attempting to pervert the course of justice. 27 Mr Walker deposes to a subpoena issued to Bryson, an allegation that Bryson failed to produce documents, an assertion that the documents were important to the defence of the action by the First and Second Respondents and an allegation that Bryson sought to entrap Walker for the purposes of the trial. Mr Walker also deposes in a series of paragraphs to complaints about the failure by Microsoft to provide particulars of infringing acts that would have enabled Mr Walker to make proper enquiries, a failure by Microsoft to produce documents and the many (10 to 27) attempts to agitate these issues with Microsoft and ultimately, the Court. There is no affidavit in the application for an extension of time and leave to appeal from Adrian Stevens or material contradicting the evidence of Guy Williams or any other direct evidence probative of a fact establishing fraud on the part of Microsoft.

The Conduct of the Proceedings on 19 August 2005 28 Counsel for Microsoft raised objections to many aspects of the evidence (the affidavit of Mr Walker of 25 July 2005) relied upon by Mr Walker. His Honour first dealt with the question of appearances and refused Mr Walker leave to appear on behalf of Magic Computers. His Honour had on an earlier occasion given leave but had made it clear that if Mr Walker sought leave on another occasion, he would need to produce proper authority from the company appointing Mr Walker or something in the nature of a resolution in writing. Mr Walker says he is the sole director of Magic Computers and did not produce any authority, appointment document or resolution. Leave was denied although Mr Walker appeared on his own behalf in any event. 29 His Honour then dealt, paragraph by paragraph, with objections taken by Microsoft's Counsel. I have read the transcript carefully and it is clear that His Honour sought to explain to Mr Walker the rules governing the admissibility of evidence and the difficulties confronting Mr Walker in seeking to rely upon the paragraphs of the affidavit under challenge. It is sufficient to simply illustrate some of these examples. Objection was taken to paragraph 14 on the ground that it was simply argumentative. Paragraph 14 was expressed in these terms: "At all times material to these proceedings and prior to these proceedings being commenced, the Applicants have failed or refused to produce any material that would show that the Respondents had in anyway infringed the Copyright or the Trade Marks Act." Objection was taken to paragraph 15 on the ground of relevance. Paragraph 15 is in these terms: "15. The Applicants had refused to disclose material evidence in respect of the "Hot Line Reports" until ordered to by His Honour, Mr Justice Lander, whom, I believe, stated that this should have been done at an earlier time." 30 As to paragraph 14, the following exchange occurred: "MR DEVLIN: Paragraph 14 is simply argument. HIS HONOUR: That's right, Mr Walker, isn't it? MR WALKER: No it isn't your Honour. There was no evidence put forward by the applicants to show that the respondents committed any breach of the copyright. If you look at the statement of claim, what it does it outlines a broad picture of what they believed happened. HIS HONOUR: But you're alleging fraud, aren't you? MR WALKER: Yes, your Honour. HIS HONOUR: Well, this has got nothing to do with that. MR WALKER: Then there's no problem with having it there, your Honour. HIS HONOUR: There's also no problem with not having it there. MR WALKER: Exactly, your Honour. HIS HONOUR: And that's the way the system works: if it's not relevant, we don't have it. MR WALKER: The idea, your Honour, was so that you, in looking at - the way I saw things was that if your Honour believed that there was a prima facie case that there was a copyright breach, then you would exercise your discretion or your - to look more favourably on the applicants than you would on the respondents. And if you saw that it shows no breach or infringement of the Copyright Act then you would have a different … HIS HONOUR: Mr Walker, if you wanted the applicant to prove infringement, then the place to do that was in the action. MR WALKER: Of course, your Honour. HIS HONOUR: You're presently seeking to set aside the settlement, aren't you? MR WALKER: Yes, your Honour. HIS HONOUR: Well, I can't see that 14 is relevant to that. I exclude it." 31 As to paragraph 15, the following exchange occurred: "MR DEVLIN: The next is irrelevant. HIS HONOUR: Well, for the same reason, it must be, Mr Walker must it not? MR WALKER: No, your Honour. HIS HONOUR: Why not? MR WALKER: Your Honour, part of the application of the notice of motion says that there was fraud perpetrated on the respondents in inducing them to sign the consent orders. HIS HONOUR: But this [the disclosure of material concerning 'Hot Line Reports' ordered by Lander J] must have been done before that? MR WALKER: Yes, your Honour. But during the court process. HIS HONOUR: Then it was for you to decide whether or not you wanted to settle the matter. You knew about the documents and you chose to settle it. No fraud there. Paragraph 15 will be excluded." 32 Objection was taken to paragraphs 26 and 27 which were in these terms: "26. At all times I have sought from the Applicants information that would allow the Respondents to make an informed decision and carry out an inquiry into the issues stated by the Applicants. 27. At all times the Applicant have refused to provide information that would have allowed the Respondents to carry out an inquiry that would have avoided the necessity of litigation." 33 As to those paragraphs, the following exchange occurred: "MR DEVLIN: [The paragraphs are] argumentative. Simply a series of submissions. HIS HONOUR: Yes. What do you say about that? What you really have to show now is that the settlement should be set aside on the basis that it was induced by fraud of some sort. MR WALKER: Yes. HIS HONOUR: Well, you can't complain about things that you knew at the time that you entered into the agreement. MR WALKER: Your Honour, you can only come to a conclusion if you've got all the facts. HIS HONOUR: These were facts that you had. MR WALKER: Yes, your Honour, but you've got to have time to think about it. You can't have them on the day. HIS HONOUR: You should have asked for that then. It was a matter for you. You are the master of your own destiny. MR WALKER: Yes, your Honour. If we're negotiating into an agreement and I put material, before, say, certain things and if that material is not correct or I don't see it before we enter into that agreement. HIS HONOUR: You had seen it. MR WALKER: Not all of it, your Honour. HIS HONOUR: That's not what you're saying here. You're here talking about material you had seen. MR WALKER: Yes, your Honour. HIS HONOUR: So there can't be any basis, and that cannot be relevant to any allegation of fraud. The paragraphs are argumentative. 26 and 27 all go out." 34 Very similar exchanges occurred in relation to other paragraphs of Mr Walker's affidavit including paragraph 28 and paragraphs 29 to 31 which were challenged on the ground that they were either argumentative or irrelevant. Paragraph 28, for example, deposed to the occasions when Mr Walker had agitated (10 occasions) the contention concerning Microsoft's failure to provide particulars and documents (although in submissions Mr Walker talks about 27 occasions) and his Honour observed [as to those various occasions], "You may have. But the point was you either got the order you wanted or you didn't. Now, if you didn't, you should have appealed. You can't just come back and now say, 'Well I was willing to accept that then, and now I'm going to have another go'. It doesn't work that way." Mr Walker observed after a continuing exchange that His Honour did not want to hear him on paragraph 28. His Honour said he did want to hear Mr Walker on the admissibility of the various paragraphs and then hear him on whatever material was left. His Honour having explained the difficulties observed [as to paragraph 28] "It is just a broad assertion that you've asked for documents. And you say unidentified documents were not provided. It can take the case nowhere and will be excluded." 35 Paragraphs 29 to 31 are in these terms: "29. The Honourable Court Ordered that the Respondents and the Applicants discover all material in the cause even if it was detrimental to their cause. 30. Instead the Applicants have embarked on a drawn out vexatious process to investigate the business activities of the Respondents on the chance that there might have been something untoward when there has not been without verifying the bona fides of the informant and whether that information was reliable. 31. Further, the motivation behind the informants actions, the rewards that informant believes that he will receive could have all been dealt with in a timely fashion if full disclosures had been made and t hat the Orders of the Honourable Court been adhered to." 36 Objection was taken to those paragraphs on the ground that they were simply argumentative and the following exchange occurred. "MR DEVLIN: [paragraphs 29 to 31] Argumentative. HIS HONOUR: Yes, what do you say about that? MR WALKER: Your Honour, you don't want to listen to me. HIS HONOUR: Well, I've been listening to you for a while now. MR WALKER: Yes. But your Honour. HIS HONOUR: I can't help it if you're saying things that are not relevant to the case you're trying to run. That's not my fault. Your case is that the settlement should be set aside for fraud. MR WALKER: Yes. HIS HONOUR: Now, to make unparticularised allegations about non-access to documents at unspecified periods of time does not assist to establish a case of that kind. Now, I'm sorry you don't like that, but that is the way it is. MR WALKER: I understand what you're saying, your Honour. HIS HONOUR: There's really nothing you can say about it, Mr Walker, I'm afraid. It may be that your labouring under a misapprehension; it is not sufficient - it is never sufficient - for one party just to say about another, 'Discovery is defective'; 'they haven't discovered everything'. That's never good enough. Discovery is in support of proceedings; it is not an end in itself. If somebody says, 'We've discovered all the relevant documents', that, prima facie, is taken to be conclusive unless the other side can show that there are documents that should have been discovered and they haven't been. So it's just not good enough for you to simply assert that you think there are other documents and you didn't get that you should have got, nor is it sufficient to say, 'I was given a document after the settlement that I hadn't seen before'. That doesn't demonstrate that it was even in existence or that it was a document to which you were entitled on discovery. You've got to do more than that. MR WALKER: They said they would provide material before trial. HIS HONOUR: They either did or they didn't. MR WALKER: It was never provided. HIS HONOUR: Well, that's something you knew at the time you entered into the settlement, and if you chose to enter into the settlement, knowing that you hadn't received something that you felt you needed, it's a matter for you. You're the master of your own destiny. You didn't have to settle; you chose to. MR WALKER: Also, your Honour, the affidavit by Guy Williams. HIS HONOUR: I don't want to move off paragraph 29 to 31 for the moment. Is this relevant to that? MR WALKER: I haven't a clue, your Honour. HIS HONOUR: I see. Well, paragraphs 29 to 31 do appear to be argumentative, since the respondent is seeking to make out a claim of fraud, leading to the compromise of the cause of action. The paragraphs cannot be of any relevance to that issue. They will be excluded." 37 An issue arose in relation to paragraph 33 which asserted unlawful conduct (unspecified) on the part of Bryson. Mr Devlin SC challenged the paragraph as argumentative. Mr Walker sought to support it and said, "It turns out, your Honour, that the only person who ever did the infringing was this guy called Peter Bryson. It was nobody else, and he is the biggest liar you have ever come across." The following exchange then occurred: "HIS HONOUR: I can't allow you to use these proceedings to make gratuitous assertions like that. MR WALKER: No, I'm … HIS HONOUR: But in any event, Mr Walker it's only your opinion. MR WALKER: Your Honour HIS HONOUR: What's in this affidavit. It's not admissible and it will be excluded." 38 Mr Walker took the view that His Honour was not properly entertaining his submissions in support of the paragraphs and asked to be excused. His Honour said, "Well, I'm sorry if you think I'm not listening to you. I thought I had been disposing of the criticisms of your affidavit, paragraph by paragraph, having given you an opportunity to justify them. I thought I had explained to you what the problem was and that my decisions had been based on that explanation, but if you're not happy and you don't want to go on with the application, well you certainly may leave. If you leave, I will be forced to strike out your motion". His Honour invited Mr Walker to address him on the issue of whether paragraphs 34 to 37 were sustainable and Mr Walker said, "Your Honour, the affidavit is an affidavit in whole. It's not there as part of something or part of anything to be pulled apart. The affidavit is a whole document and should be read as a whole document, not bits and pieces pulled apart, which takes away the meaning of the whole document." His Honour said, "Well, the difficulty with that is that there are rules of evidence". 39 Mr Walker invited His Honour to excuse himself on the ground of prejudice. His Honour refused to do so. Mr Walker pressed his proposition that the affidavit must be read as a whole document and His Honour said, "I'm sorry, the rules of evidence don't provide for that. I'm not saying that you can't justify one paragraph by reference to another. What I am saying to you is that you cannot justify everything, including things that offend the rules of evidence, simply by saying, 'The affidavit has to be treated as a whole'. That's not an answer". Mr Walker took the view that His Honour was broadly unsympathetic to him (based upon a comparison of His Honour's approach to other matters earlier that morning and his approach to Mr Walker's Application) and elected to withdraw and leave. Mr Devlin SC made some observations, for the record, disagreeing with Mr Walker's view concerning His Honour's approach. 40 Having carefully considered the transcript and the material relied upon by Mr Walker, I am satisfied that His Honour provided Mr Walker with every opportunity to make submissions concerning the relevance and admissibility of paragraphs of his affidavit sworn 25 July 2005 in response to the criticisms made by Mr Devlin SC. I am also satisfied that His Honour brought an independent mind to bear in the assessment of the relevance and admissibility of the paragraphs under attack with a view to properly and fairly applying the rules of evidence so as to do justice between the parties. In this regard, I am satisfied that a fair reading of the transcript does not suggest a reasonable apprehension that His Honour was biased. There is no basis for the proposition that His Honour did not bring an impartial and unprejudiced mind to the resolution of the issues. There was no procedural unfairness: Livesey v New South Wales Bar Association (1983) 151 CLR 288 at 293-4; Vakauta v Kelly (1989) 167 CLR 568 at 584 and 585; Johnson v Johnson (2000) 201 CLR 488 at 492 [11], 498-9 [31] - [35]; Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 344-5 [6] - [8]; Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70 at 87 and 88. 41 Microsoft relied upon an affidavit sworn 18 August 2005 by Grant Stahl Hansen (filed in matter NSD No. 1325 of 2004), a solicitor having the carriage of the action on behalf of Microsoft. Mr Hansen explains the circumstances surrounding the production of the affidavit sworn by Guy Williams. Mr Hansen says this: "3.4 On or about 20 June 2005 I was informed by Peter Bryson that a former Magic Computers' customer had come into his shop and that customer appeared to have purchased a computer from Magic Computers loaded with unlicensed software. 3.5 On or about 20 June 2005 I spoke to Mr Williams by telephone. I formed the impression that he may have purchased a computer from Magic Computers that was loaded with unlicensed software. I asked him to forward the invoices relating to the purchase and these were faxed to counsel's chambers on 27 June 2005. An affidavit was taken from Williams at the first available opportunity, namely early on the morning of Wednesday 29 June 2005. At that time Williams produced a counterfeit disk which was in his possession. On the morning of 29 June 2005 I and Ralph Devlin [Counsel] interviewed Guy Williams by himself and formed the view that he was a witness of truth. 3.6 A copy of Williams' affidavit is annexed and marked "A". I note that in paragraph 15 of his affidavit Williams discloses that he had mentioned these events to Mr Bryson. I also note that the invoice relating to his purchase of 23 February 2004 makes no reference to the supply of a licensed operating system and this in conjunction with the fact that Williams was prepared to swear that the system he purchased came with an operating system already loaded strongly corroborated my view that the computer he purchased had been hard disk loaded with unlicensed software by Magic Computers." 42 The affidavit taken from Mr Williams was sworn on 29 June and a copy of the affidavit was handed to Mr Walker by Mr Devlin SC approximately 10 minutes prior to the commencement of the proceedings on 29 June. 43 There is no evidence for concluding that the facts concerning the matters deposed to by Mr Williams were known to Microsoft at any time earlier than the period deposed to by Mr Hansen. Nor is there any basis for concluding that the evidence of Mr Williams was deliberately withheld to the last minute so as to deliberately place Mr Walker in a position of disadvantage so as to induce Mr Walker to compromise the action. Moreover, there is no basis, on any evidence, for concluding the facts deposed to by Mr Williams were not true. There is no basis for concluding, if those facts were untrue, that Microsoft knew and understood those facts to be untrue. 44 Apart from the evidence of Mr Williams, Microsoft, in the principal proceeding, relied upon a body of evidence in support of the allegations in the action. Mr Hansen says that notwithstanding Mr Walker's view that Mr Bryson was the main witness for the Applicants, the main witness was Mr Larry Moes who undertook two test purchases which, according to Mr Hansen, conclusively demonstrated that unauthorised hard disk loading had taken place at the business conducted under the name Magic Computers on at least two occasions. The evidence of Mr Guy Williams on 29 June 2005 was not the decisive evidence in terms of establishing the case for the Applicants although the additional affidavit may have been decisive in the mind of Mr Walker as a further transaction that he would need to address in the course of the trial. 45 At the conclusion of the principal proceedings and after the consent orders were made, Mr Walker was shown the CD referred to by Mr Williams in his affidavit which led Mr Walker to accept that the CD clearly was an infringing CD. Mr Walker was handed a document which he exhibits as "KW2" to his affidavit of 25 July 2005. The document is explained by Counsel for Microsoft in the transcript of 19 August 2005 as a statement of damages. It refers to January 2004 to May 2004 and identifies dollar amounts referable to particular purchases by Stevenson, Taylor, Williams, Collins, Gava and Moes. Mr Walker complains that this document was not given to him earlier.

Additional Objections to Evidence and Submissions relied upon by the First and Second Respondents 46 In the course of argument on 24 November, it became apparent that the First and Second Respondents had not provided the Applicants in the proceedings with the affidavit of Mr Walker sworn 19 September 2005. The written submissions in support of a motion were provided on the morning of the hearing. Accordingly, I gave leave to Counsel for Microsoft to make further written submissions concerning questions of admissibility of the affidavit of Mr Walker and a written response to Mr Walker's submissions. Those further submissions were required by Thursday, 1 December 2005 and Mr Walker agreed to provide any material in response to the further submissions by Tuesday, 6 December 2005. 47 Microsoft, in the supplementary submissions, objects to the following paragraphs of Mr Walker's affidavit on the following grounds: Paragraphs Objection 3-7 Irrelevant 8 Irrelevant, Hearsay 9 Irrelevant 10-11 Irrelevant, Hearsay 13 Submission, Irrelevant 14 Submission 15-17 The transcript speaks for itself 17 Submission 18 Submission 19 Irrelevant

48 I do not propose to analyse each of the paragraphs of Mr Walker's affidavit in these reasons. I make the following rulings. Paragraphs 3, 4, 5, 6 and 7 are not relevant to the question before me. Paragraph 8 is irrelevant and objectionable on the ground that the statements offend the hearsay rule. Paragraph 9 is irrelevant. Paragraphs 10 and 11 offend the hearsay rule and are both irrelevant. Paragraph 13 is in the nature of a submission but I will allow it in. I take a similar position in relation to paragraph 14. Paragraphs 15, 16 and 17 are submissions of what is contained in the transcript. Nevertheless, I will allow them in although the transcript is the source of the material in relation to the matter. Paragraph 18 is, in effect, a submission but I will allow it in. Paragraph 19 to the extent that it attempts to put a fact before the Court is inadmissible and irrelevant. 49 Objections are also taken pursuant to Order 41, Rule 5 of the Federal Court Rules to aspects of the submissions made by Mr Walker having regard to the material. Order 41, Rule 5 provides: "Scandalous, vexatious or oppressive material 5. If there is matter in a document (other than an affidavit) which is, having regard to the issues in the proceeding, scandalous, vexatious or oppressive, the Court may order that: (a) the document be removed from the file; or (b) the matter be struck out of the document." 50 The objections are these: "Page 4, last paragraph Page 5, 1st, 2nd, and 3rd paragraphs Page 6, last paragraph Page 7, 1st, 2nd and 3rd paragraphs Page 10, paragraphs (c) and (d) Page 11, paragraph 16" 51 As to the page 4 objection, the paragraph is not supported by any evidence and alleges that the affidavit of Williams was manufactured by the witness, Bryson. It should be removed. As to the page 5 objections, the paragraphs speak of Bryson as an "unmitigated liar", assert bribery of witnesses and, in essence, misconduct on the part of Microsoft. The paragraphs should be removed. As to the page 6 objection, the paragraph is unsupported by evidence and asserts the manufacturing of evidence by Bryson. It should go as well. As to the page 7 objections, those paragraphs assert that Bryson attempted to pervert the course of justice and that Microsoft (or its advisers) withheld evidence from the Respondents. The third paragraph asserts a conclusion arising from the previous two propositions. Those paragraphs should go as well. As to the page 10 objections, those paragraphs assert a deliberate withholding of evidence, a conscious attempt to ambush the First and Second Respondents and an assertion that there was bribery of witnesses. Those paragraphs should go also. As to the page 11 objection, the paragraph asserts conduct on the part of the legal advisers which misled or deceived the First and Second Respondents and the conduct is described as reflecting a lack of honesty. It is entirely unsupported by any evidence and should be struck from the submissions. 52 In addition, in the Application before me, Mr Walker relied upon his affidavit sworn 25 July 2005 upon which he relied before Dowsett J. Counsel for Microsoft presses objections to those paragraphs which were not dealt with by Dowsett J upon Mr Walker abandoning the Application. The remaining paragraphs under challenge are these: Paragraphs Objection 34-37 Irrelevant 38 & 39 Hearsay and Irrelevant 40-43 Argument

53 As to paragraphs 34 to 37, those paragraphs deal with the serving of a subpoena upon Mr Bryson, his alleged failure to produce documents, the alleged effect of those documents had they been produced and the importance of those documents to the action on behalf of the First and Second Respondents. All of these paragraphs are irrelevant. Similarly, paragraphs 38 and 39 offend the hearsay rule and are irrelevant. Paragraphs 40 to 43 are simply submissions and the expression of opinion. They should be struck out. 54 On 5 December 2005, Mr Walker filed further submissions. These submissions were to be responsive to Microsoft's supplementary submissions addressing Mr Walker's affidavit sworn on 19 September 2005 (which had not been provided to Counsel for Microsoft) and Mr Walker's earlier submissions which had not been provided to Microsoft's Counsel until the morning of the hearing of the application. 55 The further submissions by paragraph 1 raise the range of matters previously ventilated by Mr Walker, are not responsive to the submissions of Microsoft and are not relevant to the question in issue. They are complaints about failing to give discovery, fraudulent non-disclosure, admissibility of evidence, fairness, natural justice, rules of pleading, striking out pleadings, fresh evidence and cost. Paragraph 2 goes to the availability of a sealed copy of an affidavit from the Registry. Paragraph 3 asserts that Microsoft has at no stage attempted to deny the allegations against them and four subparagraphs are recited. Paragraph 4 raises the same argumentative matters dealt with in these Reasons as does paragraphs 5 and 6. Paragraphs 4, 5 and 6 repeat the same four subparagraphs recited at paragraph 3. Paragraph 7 also asserts that the solicitors for the Applicants have failed to deny the truth of particular matters which are put in an inappropriate and argumentative manner. Paragraphs 8, 9, 10, 11 and 12 make submissions about particular cases which are not to the point. 56 In addition to these submissions, Mr Walker filed on 5 December 2005 an affidavit sworn on 5 December 2005 by Guy Maurice Williams. No leave has been given to adduce any further evidence on the Notice of Motion and this affidavit does not form part of the material for the purpose of disposing of the issues. However, I propose to determine whether the affidavit of Mr Williams should be received into evidence by applying the tests for the reception of fresh evidence on appeal. Therefore, has Mr Walker established facts that demonstrate that reasonable diligence was exercised to procure the evidence for the hearing before Dowsett J and, if adduced, an opposite result would have been produced? Orr v Holmes (1948) 76 CLR 632 at 635, 640; Florance v Andrew (1985) 58 ALR 377; Arnotts Ltd v Trade Practices Commission (1990) 24 FCR 313. 57 The affidavit of Mr Williams begins by deposing, by paragraph 1, to a conversation between Williams and Peter Bryson (rather than any conversation with any employee, officer or adviser of or to Microsoft) in which Bryson is said to have promised Williams a $5,000.00 cash reward from Microsoft if Williams cooperates with Microsoft. Williams says he was attracted to the promise because his wife was having a baby and the promised reward would help with financial commitments. The affidavit concludes, by paragraph 18, with Williams saying he did not receive the "reward" from Microsoft and goes on to assert that Bryson received a $5,000.00 reward. Between the paragraphs alleging the promise of the money and the failure to provide the money, Williams deposes to facts which are said to contradict his earlier evidence. The inference is open that because Williams was disappointed that Bryson's promise was not performed, he has elected to review his evidence. 58 Williams, in the new affidavit, confirms that he purchased an AMD XP 2600 computer from the First Respondent. The purchase did not include any operating system as Williams had an operating system and wanted a reduction in price. Williams says the disk that is alleged to be non-genuine and contain infringing software was in the computer when he bought it but the software had not been installed (paragraph 6 of the Williams affidavit). Williams says that he recalls that when he turned on the AMD computer it was "Window Server 2000" and not "Window 2000 Professional" as he had previously said. Williams says that he has visited Bryson's shop many times and in June 2005 he took his computer to Bryson's business premises for repair due to computer viruses and when he received the computer back from Bryson, Williams found that the computer had been loaded with "Microsoft Window 2000 Professional", without his authority. 59 Williams asserts in a number of paragraphs that "the computer came with no software" but this seems inconsistent with paragraph 6 of the affidavit which accepts that the computer contained a disk but that the software had not been installed. By paragraph 14, Williams says that he went to Bryson's premises where he spoke with the solicitor for Microsoft, Grant Hanson. Williams confirmed that he had bought computers from the First Respondent including the AMD XP 2600 and had requested that no operating system be installed so as to achieve a price reduction. This paragraph seems consistent with the facts in paragraph 6 that the software had not been installed but nevertheless does not contradict the previous contention that the computer, as sold, contained a disk containing software consistent with a Microsoft product. In the action, that software is said to be infringing software. 60 Williams says that he has seen packets of disks on Bryson's premises (which is intended to demonstrate that Bryson had the capacity to load the computer with a disk with software infringing or otherwise). Williams also says that he did not have an opportunity to reflect on the accuracy and truth of his earlier affidavit, he was made to sign the affidavit without reading it and that Grant Hansen "wrote the juicy parts of my affidavit for the court to make out Magic Computers was in the wrong". 61 The deposed fact that the computer was not uploaded with software from the disk in the computer as supplied does not answer the criticism that the computer as supplied contained a disk which, in turn, contained copy software not authorised by Microsoft. Williams was insistent upon buying a computer without installed software to achieve the price reduction and perhaps this explains why the software on the disk in the computer was not uploaded. Perhaps, the disk ought not to have been in the computer because Mr Williams had not paid for that software. The evidence suggests that the orthodoxy of supply by the First Respondent was to include a disk containing software but on this occasion the disk ought not to have been supplied consistent with the fact that the software had not been purchased. 62 No evidence is put on to demonstrate that this evidence could not have been available earlier with due diligence and in any event it would not have been productive of an opposite result. 63 Accordingly, leave to read the affidavit of Guy Maurice Williams sworn 5 December 2005 on the Application is refused. 64 The Respondent Applicants to the motion filed short submissions in response to the filing by Mr Walker of the affidavit by Williams sworn 5 December 2005, objecting to the affidavit on the basis that leave to adduce evidence had not been given and that if the evidence was to be received, the Respondent Applicants would want to respond to the affidavit, make submissions and presumably cross examine Williams. In response to those submissions, Mr Walker on 8 December filed further submissions. Mr Walker contends that there is nothing new in the affidavit of Williams, the Court should treat the affidavit as a document in the nature of submissions in any event and the affidavit shows that the solicitors for the Applicants were fraudulent. The evidence is not new. Leave has been refused to receive it. Mr Walker concedes that no allegation is made against Mr Devlin or Mr Nase for Microsoft.

Conclusions 65 Having regard to all of these matters, I have reached the following conclusions: 1. For the reasons indicated at paragraph [40], I am satisfied that Dowsett J was not biased in the determination of the issues before him on 19 August 2005. 2. Similarly, I am satisfied that in the determination of those issues, Mr Walker was not denied procedural fairness. 3. As to the five matters contended for by Mr Walker identified at paragraphs [16] and [17], I have concluded: (a) the decision refusing Mr Walker leave to represent Magic Computers did not represent a denial of procedural fairness to the First Respondent. Order 9, Rule 3 of the Federal Court Rules provides that a corporation may not without the leave of the Court or a judge enter an appearance or defend any proceeding except by a solicitor. His Honour had previously sought to condition any application for leave by requiring Mr Walker to secure and be in a position to present clear documentary authority enabling him to appear for the company. The imposition of such a condition was within the scope of the exercise of His Honour's discretion. In any event, Mr Walker appeared on his own behalf and all of the arguments advanced by him to support the Application seemed, on the face of the material, to be the same arguments that Mr Walker would have advanced on the day standing in the shoes of Magic Computers had the discretion been exercised to give leave for Mr Walker to represent Magic Computers; (b) as to the second argument, the rulings by His Honour striking out the various paragraphs of Mr Walker's affidavit were a function of an assessment by His Honour of the rules of evidence which govern the admissibility of material. Rulings, striking out inadmissible evidence or evidence which is simply argumentative or bears the character of personal opinion, contentions or allegations rather than evidence of facts from which a conclusion might be reached or inferences drawn, is not the expression of a denial of procedural fairness or evidence of bias. It is orthodoxy; (c) the third argument concerning the contention that Microsoft had failed to provide particulars of the allegations of infringement or produce discoverable documents are not matters that His Honour was required to consider in the context of the allegation of fraud. There was no evidence that Microsoft had deliberately withheld the provision of documents and information so as to procure consent orders in settlement of the action in the course of the trial. The election to strike out those paragraphs of Mr Walker's affidavit dealing with those allegations was not the expression of a denial of procedural fairness; (d) the notion that Mr Walker suffered a denial of procedural fairness because His Honour refused to admit the affidavit of 25 July 2005 as "a whole document" notwithstanding successful challenges by Microsoft to the various paragraphs of the affidavit is novel and entirely unsustainable; (e) the fifth notion propounded by Mr Walker was that he suffered a denial of procedural fairness because His Honour failed to have regard to the history of Mr Walker's agitation of interlocutory failures leading up to trial on the part of Microsoft and that these failures were material to the question of whether the Orders of Lander J ought to be set aside. The question in issue was whether the Orders obtained by Microsoft were obtained by fraud (established on the evidence), fraud on the part of Microsoft, fraudulent conduct directly material to the judgment and whether the evidence of fraud was "fresh". The history of the interlocutory steps in relation to the provision of particulars and the production of documents (whatever the merits of those matters might be), was not relevant to the central question. There was no denial of procedural fairness by His Honour's refusal to consider those historical matters on the Application. 4. The determination of the question whether an extension of time should be given is influenced by the length of the delay, the explanation given for the delay and the prospects of success in an appeal should an extension of time (and leave) be granted. Mr Walker has filed an Application which is 20 days out of time. Although I entirely understand the circumstances which led to the delay, there must nevertheless be finality to litigation and this is particularly true of a case where a party who has consented to final orders at trial (to give effect to a settlement agreement) seeks to set aside those orders on the basis that they were obtained by fraud. In determining whether an extension of time should be granted I am influenced by the nature of the order from which appeal is sought, the prospects of success of the appeal, the nature of the orders which are sought by the appeal, the demonstrated prospects in relation to the ultimate matter which is sought to be re-argued, the ground of attack inherent in the application to set aside those orders and the period of the delay. Having regard to all of those matters, I am not satisfied that the delay has been explained properly or is ultimately acceptable. 5. There is no prospect, on the material, of the First and Second Respondents successfully establishing a ground of appeal from the judgment of Dowsett J on 19 August 2005. 6. If the failure to file the application for leave to appeal is nevertheless thought to be properly explained by the circumstances reflected at paragraph [18], I would nevertheless refuse the extension of time on the basis of the conclusion reached at point 5. 7. If an extension of time was granted and leave to appeal granted, the orders sought by the First and Second Respondents are that the Orders of Dowsett J be set aside and the Application by the First and Second Respondents to set aside the Orders of Lander J of 29 June 2005, be heard and determined according to law. Having regard to the evidence relied upon by Mr Walker in this Application, namely his affidavits of 19 September 2005, 25 July 2005 and 15 July 2005 and his submissions of 25 November 2005, there is no evidence to support the claim that the Orders of 29 June 2005 were obtained by fraud on the part of Microsoft. In particular: (a) the proposition that the production of the affidavit of Mr Guy Williams and the provision of that affidavit to Mr Walker on 29 June 2005 is a matter which establishes fraud on the part of Microsoft is unsustainable; (b) although the affidavit was provided on 29 June 2005 shortly before the continuation on that day of the trial and although Mr Walker had a limited opportunity (2 hours) to consider the facts deposed to in the affidavit and the attachments to the affidavit, he nevertheless had that material available to him for consideration and assessment prior to consenting to the orders; (c) the thrust of the criticism of the affidavit lies in the claim that Mr Peter Bryson was involved in conduct to construct the evidence deposed to by Mr Williams. There is no evidence to suggest that Microsoft dealt with the evidence of Mr Williams in any way other than on the basis that its lawyers believed the evidence to be truthful [41]. The conduct of Mr Bryson is not the conduct of Microsoft; (d) the issues raised by Mr Walker concerning alleged failures on the part of Microsoft to provide particulars and documents in the interlocutory stages leading to trial (and at trial) are not matters which, on the evidence, raises any question of fraudulent conduct. Those matters were, in part, on the contention of Mr Walker the subject of interlocutory challenge. To the extent that the issue remained, it ought to have been the subject of further interlocutory challenges under the Federal Court Rules; (e) the provision, after the settlement, of the schedule identifying the dollar value of the loss arising from the transactional claims and the provision to Mr Walker for examination of the CD is not evidence of fraud on the part of Microsoft in obtaining the Orders; (f) it is clear that Mr Walker consented to the Orders having appreciated the consequences of the Orders (see para. [7]). 66 Accordingly, I dismiss the Notice of Motion issued by the First and Second Respondents dated 15 September 2005. Microsoft seeks the costs of this Application on an indemnity basis on the ground that Mr Walker continues to make unsupported allegations of fraud. The allegations are unsupported by any evidence consistent with the principles identified in Wentworth v Rogers (No. 5) [supra], Spies v Commonwealth Bank of Australia [supra], or Monroe Schneider v No 1 Raberem [supra]. The material fails to demonstrate any prospects of success of setting aside the Orders of Dowsett J of 19 August 2005. 67 I order the First and Second Respondents to pay the Applicants' costs of the Application on an indemnity basis. I certify that the preceding sixty-seven (67) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood.

Associate: Dated: 13 December 2005 Counsel for the Applicant: Self-represented (Mr Kell Walker)