Plaintiff v Defendant

Plaintiff v Defendant - [2011] VSC 205 - VSC 2011 case summary — Zoe

[44]

22 IPL, on the other hand, submitted that the manner in which the Model is proposed to be pleaded in paragraph 34 of the proposed Statement of Claim does not amount to an identification or definition of the confidential information, the Model, sought to be protected. It was said that the particulars to paragraph 34 itself demonstrate this in that, in paragraph (a), reference is made to the Model being "described and illustrated in paragraphs 35 to 38 below and the particulars thereto". It was submitted that this is not the same as identifying or defining the information, and it was said, further, that the allegedly confidential information is not defined or identified anywhere else in the proposed pleading. It was submitted that this is not a matter of semantics, but rather a critical issue in circumstances where the courts impose an obligation on a plaintiff in a confidential information case to identify the relevant information precisely and with specificity.[18] It was also submitted that the reference to Annexure B to the proposed Statement of Claim, in paragraph (b) of the particulars to paragraph 34, does not enhance MMFC's position in any way. Rather, it was said that these particulars, which are headed "particulars of Conception and Development", are merely descriptive and add nothing in terms of identifying or defining the information sought to be protected, namely the Model. Similarly, it was said that Annexure C to the proposed Statement of Claim adds nothing in terms of the identification or definition of the Model. Annexure C, as IPL submitted is, in my view, properly characterised as merely illustrative. As Mr Scerri QC noted, it is headed "Illustration" and then says, in paragraph 1 of that annexure: "The MMFC LTAL Model can be explained and illustrated by reference to the graph and corresponding table". The material in Annexure C then contains references to, and examples of, "inputs" and "outputs". On this basis, I cannot accept the characterisation by Mr Shavin QC on behalf of MMFC of the Annexure C material as a "working explanation" of the Model.

[60]

"Plainly enough, in the light of the findings of the primary judge and the evidence, there is very little, if anything, in the documents mentioned in paras (1) and (2) above that can constitute confidential information. Generally speaking the contents of the unit trust deeds and the articles of association were matters of common knowledge. Information may be categorized as public knowledge though only notorious in a particular industry or profession: see Finn: Fiduciary Obligations (1977) at 146. Only those improvements evolved by the respondent could give rise to a claim for relief for breach of confidence: see generally Saltman Engineering Co, Ferotec Ltd and Monarch Engineering Co (Mitcham) Ltd v Campbell Engineering Co Ltd;[30] Seager v Copydex Ltd;[31] Coco v A N Clark (Engineers) Ltd.[32] It is at this point that the respondent has consistently failed to identify the particular contents of the documents which he asserts constitute information, the confidentiality of which he is entitled to protect. The consequence is that he has failed to formulate a basis on which the court could grant him relief on the assumption that some part or parts of the documents constitute confidential information.

It is a fundamental problem with the information which the respondent seeks to protect that it is information which, by way of advice to others, he regularly publishes to the world at large, albeit for a limited purpose. The nature of such information ill accords with the accepted conception of confidentiality, which in substance involves the person seeking to protect the information largely keeping it to himself: see Ansell Rubber Co Pty Ltd v Allied Rubber Industries Pty Ltd.[33] In the result, the respondent's relief in respect of the documents should be confined to infringement of copyright.

The information mentioned in paras (3) and (5) above falls into the same category. To simply say that the information is as to the effect and practical operation of discretionary trusts and private unit trust schemes does not identify the information and enable the court to formulate an order. One needs to know not only what was the information conveyed, but also what part of that information was not common knowledge.

The description of the information referred to in para (4) suffers from the same defect. It consists of: - (a) advice (unspecified) as to the effect of three sections of the Income Tax Assessment Act and the Banking (Foreign Exchange) Regulations; (b) the form of resolutions for the issue of, and investment in, special units; (c) the provisions of the trust deed; and (d) minutes and resolutions giving effect to the proposal.

The description thus given invites the comment that the material would be more likely to lend itself to a claim for copyright than to a claim for confidential information. In particular I have some difficulty in perceiving how advice as to the general legal effect of statutory provisions can constitute confidential information. And the form of minutes, resolutions and the provisions of a trust deed seem unlikely repositories of confidential information. Again the problem is caused by the generality of the description which the respondent has chosen as a means of identifying the information which he seeks to protect. It is so general that we cannot satisfy ourselves, in the light of the findings of fact made by the primary judge, that the information so described was imparted by the respondent to the appellants, that it was imparted in circumstances which gave rise to an obligation of confidence and that it does not include material which is common knowledge."

[62]

26 Another aspect stressed in the judgment of Mason J in O'Brien v Komesaroff is that it is essential that the confidential information sought to be protected is precisely identified or defined so that it is possible for a party (such as a party in IPL's position) to know when it is at risk of a claim of wrongfully using such information.[34] Thus, IPL submitted that neither paragraphs 34 to 38 to the proposed Statement of Claim or Annexure K to the proposed pleading provide any basis upon which IPL could know what it is that either CBA or IPL was not permitted to use without paying MMFC a 1.5% fee for the use of its claimed confidential information. It was submitted by IPL that Mason J emphasised in O'Brien v Komesaroff[35] that a court needs to know what order it is to make and that, in the particular circumstances of that case, could not look at the unit trust deed and find an answer to this question. It was made clear by the High Court that the confidential information sought to be protected must be defined or identified if the court is to be able to make any orders. Further, IPL submitted that the fact that an injunction is not sought would not avoid the problem because, it was said, according to MMFC's case, if IPL enters into another leasing transaction next week, it can be sued again. Consequently, it was submitted, the question is "What sort of leasing transaction will attract that suit and that fee? Is it one that has a long term? Is it one that has a number of short-term leases that, together, add up to the long term? Mr Shavin said we're trivialising what they allege in paragraph 35(a). Well, all 35(a) says is you have a long term broken up into short terms and when you add the long terms together they add up to the total. That is what is always said and we've always trivialised it because it deserves to be trivialised. So going back to the analogy; what if next week IPL or CBA goes into a long term leasing arrangement, what are the parameters, what are the boundaries of MMFC's rights?".[36] In seeking to answer an objection of this nature, MMFC submitted that "what the terms of any injunction would be, if an injunction were to be sought, would clearly be a model comprising the structure, the input values and the steps in Paragraphs 35-38. It's a combination. And it has to be something that has the whole of the combination."

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