(i) Alleged misapprehension as to the evidence of Mr Newman
24The first matter to which the City points is the reference at [172]-[173] of the principal reasons to the rejection by his Honour of the question put to Mr Newman in cross-examination that is set out at [166] of the reasons. At [172]-[173], in the context of considering the evidentiary grounds of appeal that had been raised by the appellants, it was noted that:
[172] The parts of the evidence of Mr Newman, Dr Green and Mr McLeod that the judge did not allow to be adduced went to two related questions: first, whether substantial parts of the relevant information were in truth confidential when imparted by the City to Streetscape (and thereby to Mr Obeid); and, second, whether initial confidentiality was lost at some future time. The evidence was directed to what was observable by simple inspection of poles already erected and what could be learned by inspecting generally available materials, including patent specifications and promotional and other literature accessible on the internet and elsewhere.
[173] The judge declined to allow the trial to take a course that tested the proposition (advanced by the City) that relevant information was confidential when imparted and remained confidential at all relevant times thereafter. His Honour referred in his 4 August 2011 reasons to the indication by Streetscape and Mr Obeid that they would seek to elicit evidence in cross-examination of the City's witnesses to make good the argument that various disclosures had destroyed any confidentiality (see [143] above). The judge expressly disallowed that course in relation to Mr Newman and Dr Green. He cut off at their very inception lines of questioning of those witnesses which went directly to a central issue; and he refused to allow Streetscape and Mr Obeid to adduce evidence on the subject through Mr McLeod's affidavit.
25There is no dispute that the primary judge disallowed a question put to Dr Green (an expert called for the City) as to what could be observed by a person reading a patent relating to an earlier version of a multi-function pole like the Smartpole; nor that his Honour rejected parts of an affidavit relied upon by the appellants (Mr McLeod's affidavit) in which Mr McLeod referred to publicly available information about various multi-function poles and components that he had seen in Australia and elsewhere, including photographs Mr McLeod had exhibited to his affidavit and extracts from websites of several pole manufacturers or suppliers.
26Rather, it is pointed out by the City that although his Honour initially disallowed the following question put to Mr Newman in cross-examination:
Would you agree that you can see by looking at the pole all of the essential features of the Smartpole?
as recorded at [166] of the principal reasons, that question was subsequently allowed and answered. The circumstances in which this occurred were that his Honour heard argument on the objection made to the question, reserved his decision on that issue, gave his ruling when the Court next resumed (disallowing the question) and then, following further debate with Mr Couper QC, who then appeared for the appellants, allowed the same question to be asked and answered.
27His Honour's reasons for first rejecting the question were set out in an interlocutory judgment published on 8 August 2011 (City of Sydney v Streetscape Projects (Aust) Pty Ltd [2011] NSWSC 847), from which it is clear that his Honour considered that the question went to the possibility that Smartpoles manufactured elsewhere had been "reverse engineered" from Smartpoles already in existence pursuant to the Licence Agreement between the respective parties (see [7] of those reasons).
28His Honour noted that Mr Couper had asserted an entitlement to put the question on the basis that the pleading gave rise to a question whether, once the pole was in the public domain, its design was no longer confidential and that, since the pleading indicated that confidentiality of the pole was an issue, he should be allowed to cross-examine on it. However, his Honour rejected that proposition. His Honour considered that a careful reading of paragraphs 4(4A) and 17(e)(viii) of the Commercial List Response did not indicate that reverse engineering was going to be an issue (though accepting that the pleading did indicate that there would be an issue as to whether placing a pole in the public domain removed confidentiality); considered that there had been a failure by the appellants to comply with Rule 14.14; and therefore held that the appellants were not entitled to pursue that line of cross-examination.
29When his Honour's interlocutory reasons were published, there was an exchange between Counsel and his Honour (at Black 3/1178-1180) as to the parameters of permissible cross-examination in light of that ruling. Mr Couper sought to maintain questioning going to the issue of confidentiality; Mr Jucovic QC, appearing for the City, maintained objection to any question directed to "a process of engaging in reverse engineering".
30The question was ultimately allowed on the basis that Mr Jucovic had indicated that there was no objection to questions in that area as long as they did not venture into territory "beyond the pleadings". His Honour appears implicitly to have endorsed, and Mr Couper accepted, that limitation.
31The evidence then given by Mr Newman was as follows (from Black 1/86M-X):
Q. Can I ask you this question. Would you agree with me that you can see, by looking at the Smartpoles which have been erected in the streets of the CBS of the city of Sydney, all the essential features of the Smartpole?
A. You see as much as you can see from the street yes.
Q. Would you agree that what you can see from the street is all the essential features of the Smartpole?
A. No, because you cannot see properly inside the track which is quite important to the Smartpole.
32As Mr Jucovic points out, the above exchange was drawn to this Court's attention on the appeal (on 27/11/12 at T 21.17). The reference at [166] to the disallowance of this question did not refer to the later allowance of the question. This was an oversight. It was therefore incorrect to include (at [172]-[173]) reference to the disallowance of that course of cross-examination of Mr Newman, at least without acknowledging that the question was later allowed subject to an apparent limitation that it could not be used to support an unpleaded issue as to the possibility of reverse engineering of the Smartpole.
33It is submitted by Mr Jucovic that paragraph [174] of the principal reasons was therefore erroneous, at least insofar as it relied on the questioning of Mr Newman. That paragraph was as follows:
[174] In those ways [i.e., in the ways referred to in [172]-[173]], his Honour showed that the positive decision to exclude paragraph 17AB(b) from the case was not somehow offset or blunted by the existence of either the introductory words of paragraph 17AB of the revised commercial list response or paragraph 4(4A). The confidential quality of the information was a central pillar of the City's case based on an equitable duty of confidence introduced in August 2011 through the fifth further amended commercial list statement.
34However, the conclusion reached in [174], as Mr Jucovic's submission implicitly accepts, did not rest solely on the disallowance of the question put to Mr Newman. The primary judge did cut off, at its inception, the similar line of questioning of Dr Green and did reject evidence from Mr McLeod that went to his observation of other multi-function poles (although only one of the photographs sought to be tendered was taken of poles existing prior to the Licence Agreement). To the extent that the rejection of that evidence demonstrated the same or similar reasoning that had led to the initial disallowance of the question put to Mr Newman, it shows that the general denial of paragraph 30B and the response to the breach of contract case in paragraph 4(4A) were not perceived as sufficient to allow questions going to the confidential quality of the information, that would arguably have been permitted had paragraph 17AB(b) been allowed.
35His Honour's reasons for initially disallowing the question put to Mr Newman make it clear that his Honour regarded the question whether the features of the Smartpole could be discerned by observation from the street and, similarly, as to what could be discerned from the earlier patent, as going in substance to the "reverse engineering" issue. The conflation of the reverse engineering issue and the "no confidentiality" issue revealed an approach by his Honour that was inconsistent with him engaging fully in the identification of what was or was not confidential information that was used in relation to the poles.
36While it is accepted that [166] was incomplete in not referring to the subsequent allowance of the Newman question, this does not alter the fact that other evidence was excluded by his Honour that went to the quality (or maintenance) of confidentiality in the poles. Nor was the reference to the disallowance of the question put to Mr Newman on 5 August 2011 relevant to or determinative of the ultimate conclusion on the equitable duty of confidence issue on the appeal, which was that his Honour had failed to identify with specificity the relevant confidential information.
37The only variation necessary to the principal reasons to address this first matter is that which would make clear that the question at [166] was later asked and answered by Mr Newman, namely to amend [172] and [173] to read as follows:
[172] The parts of the evidence of Mr Newman, Dr Green and Mr McLeod that the judge did not allow (or, in the case of Mr Newman, did not at first allow) to be adduced went to two related questions: first, whether substantial parts of the relevant information were in truth confidential when imparted by the City to Streetscape (and thereby to Mr Obeid); and, second, whether initial confidentiality was lost at some future time. The evidence was directed to what was observable by simple inspection of poles already erected and what could be learned by inspecting generally available materials, including patent specifications and promotional and other literature accessible on the internet and elsewhere.
[173] The judge declined to allow the trial to take a course that tested the proposition (advanced by the City) that relevant information was confidential when imparted and remained confidential at all relevant times thereafter. His Honour referred in his 4 August 2011 reasons to the indication by Streetscape and Mr Obeid that they would seek to elicit evidence in cross-examination of the City's witnesses to make good the argument that various disclosures had destroyed any confidentiality (see [143] above). The judge expressly disallowed that course in relation to Dr Green. He cut off at their very inception lines of questioning of Dr Green which went directly to a central issue; and he refused to allow Streetscape and Mr Obeid to adduce evidence on the subject through Mr McLeod's affidavit. (amendments italicised)