University of Western Australia v Gray

Reasons for judgment of the primary judge 18 The trial before French J lasted some 50 days, with the Court sitting extended hours on most days. There were some 4,568 pages of transcript and more than 1,000 documentary exhibits. The circumstances addressed in the evidence spanned a period of some twenty years. His Honour's reasons occupy 1,619 paragraphs. The facts were wide ranging, complex and detailed. 19 The primary Judge's reasons set out Dr Gray's professional history, including the history of his employment by UWA, the people with whom he worked and the work they carried out, the relationship between him and other UWA academics and administrators, his attempts to obtain funding from various sources for his research, and his attempts to "commercialise" the technologies. 20 His Honour analysed the facts in a generally chronological sequence. We mention here only the salient facts as to the funding of Dr Gray's research and the funding bodies involved, leaving until later the facts concerning the making of the inventions. 21 The following is therefore but a brief summary account of certain aspects of his Honour's reasons. In order to avoid tedious repetition we will not state "his Honour said", "his Honour found" and so on, nor necessarily indicate passages that are quoted or paraphrased. Some aspects of the summary will be repeated in the more detailed discussion later in these reasons. 22 Prior to his appointment at UWA, Dr Gray had, for some years, in particular at the University of Melbourne at St Vincent's Hospital in Melbourne, been engaged in researching the treatment of liver cancer by using microspheres injected into the blood vessels of the liver to deliver anti-cancer therapies to the sites of tumours there. The microspheres were directed to the tumour sites with the aid of a vasoactive agent which temporarily promoted blood flow into the tumour blood vessels at the expense of blood flow into normal liver tissue. It was that line of research that Dr Gray, along with other researchers in a team that he assembled, continued to pursue at UWA. 23 His Honour summarised the general nature of Dr Gray's research as follows (at [3]): In the years that followed Dr Gray's appointment work was done on three microsphere technologies. One was known as SIR-Spheres, the acronym SIR standing for Selective Internal Radiation. It was designed to transport a short lived radioisotope to irradiate cancerous tissue. A second class, DOX-Spheres, was designed to transport and release, in a controlled way, anti-cancer drugs and particularly doxorubicin. A third technology, Thermo-Spheres, involved the delivery of microspheres of magnetic material into the cancerous tissue and heating them by the external application of an alternating or rotating magnetic field. It relied upon a phenomenon known as "magnetic hysteresis". Provisional applications for various patents and international applications under the Patent Cooperation Treaty were made in respect of inventions said to have been developed in relation to the various technologies. Various applications were made over a period of years. 24 The institutional history relevant to the research conducted by Dr Gray and those associated with him was complex, and was traced by the trial Judge, as was the succession of UWA's Vice-Chancellors and other office-bearers. We will do no more here than refer to certain aspects, noting that his Honour listed at [246] under the heading "Summary of findings about implementation of intellectual property policy and regulations - 1985-2006" findings that he said emerged from the history that he had previously recounted. 25 The UWA Department of Surgery was located at RPH, among other sites. When Dr Gray took up his appointment in February 1985, 70% of his salary was paid by UWA and 30% by RPH. He was provided with an office and a secretary. RPH paid for the secretary who was to provide support for Dr Gray and the three other academics in the Department at the time. 26 At the time of Dr Gray's appointment, UWA had already established research outlets. On or about 30 November 1976 it had caused "Uniscan Ltd" (Uniscan) to be incorporated as a company limited by guarantee. In 1982-83 it had established a Centre for Applied and Business Research (CABR). CABR was not a body corporate but an administrative unit of UWA. Although CABR had its own board of management, it was effectively operated in conjunction with Uniscan, which, of course, as a registered company had a board of directors. In the second half of 1984, UWA established an intellectual property unit within CABR. On 14 December 1984, Dr Ian Nicholas became the Director of CABR. 27 On 26 May 1986, the Senate of UWA resolved to establish a position of Deputy Vice-Chancellor (Research). This new position was filled on 1 April 1987. The first appointee was Professor Robert Parfitt. 28 In the period 1985 to 1988 Dr Gray established a research group to continue with him the research on which he had been engaged in Melbourne. The researchers in the group were all employed as staff members of UWA: see [340] (unless the context indicates otherwise, numbers in square brackets are references to paragraphs in the reasons for judgment of the primary Judge). Two of them of particular significance in those early days of Dr Gray's employment by UWA were Dr Mark Burton and Dr Cameron Jones. 29 Dr Burton had worked with Dr Gray in Melbourne and Dr Gray had insisted that UWA employ him as a condition of Dr Gray's acceptance of the appointment as Professor of Surgery. Dr Burton remained employed by UWA until 1993. 30 Dr Cameron Jones was a 1984 graduate of UWA with an honours degree in science, majoring in organic chemistry (he obtained his PhD degree some time later but, like the primary Judge, we will refer to him as Dr). His appointment to the Department of Surgery on 1 July 1985 marked the start of his research career. Dr Cameron Jones remained employed by UWA until 31 December 1987. He went to the United States of America for most of 1988 to travel, and was again employed by UWA from November to mid-December 1988. 31 Dr Yan Chen joined Dr Gray's research group later, on 1 September 1989. She worked on the DOX-Spheres project. Her employment history with UWA and RPH is somewhat complicated: see [490]. In or about October 1994 she gave notice of her resignation. 32 Another Dr Jones featured in the case. This was Dr Stephen Keith Jones who was employed by UWA from 8 January 1990 to 19 August 1994 (he had been appointed by UWA on a part-time basis for earlier periods) and again from early 1996 to 31 January 1997. Dr Stephen Jones's work was relevant to the Thermo-Spheres-1 Invention. 33 At some time between 23 April 1993 when the Senate of UWA resolved to advertise a new position of Pro Vice-Chancellor (Research) and February 1994 when Professor Michael Barber took up his appointment to that position, UWA caused Uniscan to be deregistered. 34 Relevant funding bodies external to UWA included CRI to which reference has previously been made, and the Lions Cancer Institute (LCI), which was also incorporated under the Associations Incorporation Act 1987 (WA). LCI was incorporated on 25 January 1991 and, as noted above, CRI, which was originally called "Friends of the Cancer Institute Inc", was incorporated a few days later on 30 January 1991. As noted earlier, CRI was the third respondent at first instance. Both CRI and LCI were established to support Dr Gray's research. Although we have said "external to UWA", LCI and CRI became affiliated with UWA in 1995 and became part of UWA's Centre of Applied Cancer Studies (CACS) which was established in 1996 (see [39] below). 35 Dr Burton chaired the medical advisory committee of LCI and CRI until he resigned from UWA in late 1992, or 1993. LCI and CRI funded the SIRT-Spheres research which was disrupted by Dr Burton's departure. From about 30 June 1994 to about 12 February 1998 Dr Gray was the Medical Director/Director of Research of CRI and a member of CRI's Board of Management. 36 The evidence before his Honour dealt with applications for funding, some successful and some unsuccessful, to sources external to UWA, including the Cancer Foundation of Western Australia (CFWA), RPH, the RPH Research Foundation, the Commonwealth Scientific and Industrial Research Organisation (CSIRO), the National Health & Medical Research Council (NH & MRC) and the Medical Research Fund of Western Australia (MRFWA) (see [381]). 37 The sources of funding mentioned to date were public. On 19 April 1995, a company in the private sector, Paragon Medical Ltd, was registered (it was later to change its name to "Australian Surgical Products Ltd" - see below). 38 On 29 February 1996 an agreement was entered into between UWA and RPH according to which Dr Gray's salary would be provided as to thirty percent by RPH and seventy percent by UWA's Department of Surgery, as from 1 March 1996. 39 LCI and CRI had been affiliated with UWA since October 1995, and on 1 March 1996 they and UWA entered into an agreement for the establishment at UWA of CACS, of which they were to be part. 40 As noted earlier, on 3 March 1997 Dr Gray changed from being a full-time appointment to being a thirty percent fractional appointment at UWA. 41 In April 1997 Paragon Medical Ltd changed its name to "Australian Surgical Products Ltd" (ASPL). On 21 April 1997, a new company was incorporated. This was "Paragon Medical Limited". On or about 4 April 2000 this new company changed its name to "Sirtex Medical Limited". It was this company, Sirtex, that was the second respondent at first instance. Dr Gray was a foundation director of Sirtex. For various periods he also held other offices within Sirtex. For distinguishing purposes, in the primary Judge's reasons for judgment the original Paragon Medical Ltd was variously called "old Paragon Medical" and ASPL. We shall use the same abbreviations. We will sometimes, when referring to events in the period from 21 April 1997 to 4 April 2000, call the new Paragon Medical Ltd simply "Paragon Medical", but it will be appreciated that this legal entity continued as Sirtex. 42 On or about 1 May 1997 and in October 1997 Dr Gray executed deeds of assignment to Sirtex of intellectual property rights arising out of the inventions said to be associated with the technologies. 43 As noted earlier, Dr Gray ceased employment with UWA on 21 November 1999. 44 In the late 1990s UWA was aware of Dr Gray's involvement with an external company and the prospect of commercialisation of the technologies. Certainly by 1999, UWA's officers formed the view that UWA might have some claim on the intellectual property rights being exploited by Sirtex. A letter from Professor Schreuder, the Vice-Chancellor, to Dr Gray in 1999 made that clear. 45 UWA was also aware in 2000 that Sirtex was floated in that year to commercialise and market the technologies, that it issued a prospectus, and that it had acquired intellectual property rights in respect of the targeted microsphere technologies which it proposed to exploit commercially. Sirtex issued the prospectus on or about 17 July 2000 and was admitted to the official list of the Australian Stock Exchange (ASX) on 23 August 2000. 46 Notwithstanding UWA's awareness of these matters, its Pro Vice-Chancellor (Research), Professor Barber, decided that any investigation into whether UWA had an interest in the intellectual property would be difficult. Moreover, he considered that the making of a claim at a time sensitive to Sirtex's float might expose UWA to a claim by Sirtex for damages. Professor Barber's hope was that if Dr Gray made a lot of money out of the float, he might fund a Chair of Surgery at UWA. He concluded that the risks of legal action were not outweighed by the likely benefits of it. Ultimately, however, after sending letters of demand to Dr Gray and Sirtex in October 2004, UWA commenced proceedings on 21 December 2004. In the meantime many people had invested and traded in Sirtex shares and Sirtex had expended money on the development of the technology. 47 UWA alleged that Dr Gray had breached his contract of employment. The terms of that contract made Dr Gray subject to UWA's Act, the University of Western Australia Act 1911 (WA) (UWA Act) and to "the Statutes and regulations of" UWA. One breach of contract that was alleged was that Dr Gray had failed to comply with disclosure and associated obligations imposed by UWA's patents regulations which the Senate of UWA made on or about 13 December 1971 (Patents Regulations), and their successors, UWA's intellectual property regulations which the Senate made on 22 July 1996 (IP Regulations). 48 Regulation 6.1 of the Patents Regulations required a person subject to them to inform the Vice-Chancellor immediately of any patentable invention made or developed wholly or in part during the course of the person's duty or while using UWA's research facilities (Prompt Notification Condition). The Patents Regulations required the Vice-Chancellor to refer the matter disclosed to a "Patents Committee" and to act on that Committee's advice as to whether to exercise UWA's "rights in the invention" and to inform the inventor accordingly (at [41]). 49 The primary Judge found that from 1988 UWA had effectively abandoned the Patents Committee mechanism, and that after that time the possibility that a committee could be appointed on an ad hoc basis to respond to reports of particular inventions was never considered. Instead, UWA used Uniscan and CABR, its Deputy Vice-Chancellor (Research) and later its Pro Vice-Chancellor (Research), to provide a framework within which inventions could be commercially exploited. 50 His Honour concluded that because the Patents Committee was an essential element of the Prompt Notification Condition and its sequelae, this aspect of UWA's breach of contract case failed - a conclusion that is the subject of Ground of Appeal 8. 51 His Honour found that the IP Regulations were not shown to have been promulgated as required by the UWA Act before 30 November 1997, and proceeded on the basis that they did not come into effect until that date. That was after the assignments by Dr Gray to Sirtex. His Honour's conclusion adverse to UWA on the Patents Regulations aspect therefore affected its claim of breach of contract up to 30 November 1997. 52 UWA also claimed that Dr Gray had breached fiduciary obligations that he owed to it (and that Sirtex had been knowingly concerned in those breaches and had provided knowing assistance to him in them by the issue of the shares to him). 53 Importantly, UWA's case against Dr Gray (and Sirtex) depended on the proposition that it was an implied term of Dr Gray's contract of employment that intellectual property developed in the course of his employment belonged to UWA. His Honour rejected this proposition. He concluded that in the absence of express agreement to the contrary, rights in relation to inventions made by academic staff in the course of research, whether or not made with the use of UWA resources, ordinarily belong to the academic staff as the inventors under the Patents Act 1990 (Cth) (Patents Act). The position would be different if staff had a contractual duty to produce inventions, but, put simply, the duty to research did not signify a duty to invent (at [12]). 54 The IP Regulations asserted ownership by UWA of all intellectual property developed by its staff (apart from most copyright). His Honour held (at [13]) that such provisions of the IP Regulations as purported to vest intellectual property rights in UWA or to interfere with the intellectual property generated by its academic staff were beyond UWA's regulation making power and invalid. Moreover, as noted at [51] above, the IP Regulations did not come into effect until 30 November 1997. 55 For the reasons mentioned above, his Honour summarised at [15] his conclusion that the legal foundation of UWA's case against Dr Gray did not exist. 56 The primary Judge dealt in detail with the matters referred to above in relation to the implied terms, fiduciary obligations, Patents Regulations and IP Regulations at [1]-[257] of his reasons. In addition, however, on the assumption that his conclusion that there was no term in Dr Gray's contract of employment having the effect of vesting rights to his inventions in UWA was incorrect, his Honour expressed himself as not satisfied that the inventions, other than the DOX-Spheres Invention, were made by academic staff of UWA in the course of their employment there. That conclusion depended upon a consideration of the times at which the inventive concepts underlying the inventions were created. 57 Most of the primary Judge's reasons for judgment ([258]-[1330]) addressed the facts relating to the three invention streams. We will address those paragraphs when dealing with the SIRT-Spheres, the DOX-Spheres and the Thermo-Spheres-1 Inventions below. 58 At [1331]-[1332] his Honour summarised UWA's claims against Dr Gray for breach of contract, and at [1333]-[1334], its claims against him for breach of fiduciary duty. 59 The primary Judge addressed the subject of UWA "interests" and "property rights" in relation to inventions at [1347]-[1356]. 60 Counsel for UWA ultimately agreed that the rights asserted by UWA "flowed entirely from its contractual relationship with Dr Gray" (at [1348]). This concession was, however, subject to UWA's additional contention that in making claims for intellectual property protection on his own behalf, Dr Gray held the benefit derived from those claims on trust for UWA as a consequence of his fiduciary obligations to UWA. Dr Gray's fiduciary duties were said to derive from his "employment" and his fiduciary claim was said to be "distinct", and "not just a contract case" (at [1348]). 61 At [1357]-[1367] his Honour addressed the question of the implication of terms in law arising in accordance with general law principles from Dr Gray's contract of employment. He held that Dr Gray was not employed or under a duty to invent, and that he was free to decide the nature and purpose of his research and to publish the results of it, along with any inventions arising from it, notwithstanding that such publication might destroy the patentability of the invention. These freedoms were inimical to the implication at law of terms of the kind relied on by UWA. 62 His Honour concluded (at [1388]) that from 1985 until October 1995, when, pursuant to an Affiliation Agreement, LCI and CRI became affiliated with UWA, Dr Gray remained a full time employee of UWA and any research he conducted was within the scope of that employment. Whether or not such research was funded by LCI or CRI did not change his status as a full time employee of UWA nor the character of the work that he did. 63 His Honour next concluded (at [1389]) that from the time of the Affiliation Agreement of October 1995 to the making of an agreement between UWA, LCI and CRI dated 1 March 1996 for the establishment of CACS (the CACS Agreement), intellectual property derived from work funded by LCI or CRI under the Affiliation Agreement was for the benefit of LCI or CRI, subject to UWA's having a right to negotiate for a share of the profits. Work done by Dr Gray for RPH, on the other hand, was within the scope of Dr Gray's employment by UWA. 64 His Honour then found (at [1390]) that following the making of the CACS Agreement on 1 March 1996, Dr Gray's work for CACS was within the scope of his employment by UWA, but subject to the terms of the CACS Agreement, which meant that intellectual property developed during that time was for the benefit of CACS staff subject to UWA having a right to negotiate for a share of the profits. 65 To the extent that Dr Gray worked for old Paragon Medical (ASPL) his work was outside the scope of his UWA employment (at [1391]). That work, however, was not research work (at [1386]). 66 Finally, from the time of the fractional appointment conversion on 3 March 1997 until his resignation from UWA in November 1999, Dr Gray worked for UWA, RPH, CRI, LCI, CACS, old Paragon Medical, and Sirtex, being employed as to thirty percent of his time by UWA for his work at RPH which was, however, clinical work (at [1392]), for which he was paid by RPH. After March 1997 Dr Gray was not employed by UWA to research, let alone to invent (at [1387]). 67 There was no suggestion that Dr Gray did any research in his capacity as an officer of ASPL (old Paragon Medical) and any work he did for Paragon Medical lay outside the scope of his employment by UWA, as did his work for Sirtex. He did not conduct any research work for Sirtex until, at the earliest, May 1997 (at [1386]). 68 Until Dr Stephen Jones became employed by UWA in January 1990, no research experiments at UWA had been done on hysteresis hyperthermia. His Honour accepted a submission by Sirtex that there was no evidence that the inventive concept for the Thermo-Spheres-1 Invention came into existence prior to April 1997. 69 Dr Stephen Jones resigned from CACS on 22 January 1997 with effect from 31 January 1997, and by April 1997 was employed by old Paragon Medical (ASPL) (see [1537]). To the extent that he worked for that company his work was outside the scope of his employment by UWA. 70 There was no evidence that Dr Gray was involved in the inventive concept of the Thermo-Spheres-1 Invention (at [1537]). Therefore his Honour accepted that the inventive concept underlying the Thermo-Spheres-1 Invention was not developed either at a time when Dr Stephen Jones was an employee of UWA or in the course of Dr Gray's employment at UWA. 71 His Honour was satisfied that the intellectual property generated by research work funded by LCI and grants processed through CACS during that time did not vest in UWA. At best it had a right to negotiate in respect of it. Dr Gray's work for Sirtex during that time was outside the scope of his employment by UWA.

UWA's pleaded case at first instance 72 It is desirable to note certain aspects of UWA's pleaded case at first instance. This was found in its second further substituted statement of claim - a document that comprised 164 paragraphs extending over 70 pages. 73 Paragraph 7 pleaded that by s 16E(1) of the UWA Act, from 13 December 1971 to 22 July 1996 the Patents Regulations, and from 22 July 1996 the IP Regulations, were binding on Dr Gray during the period of his employment by UWA from 11 February 1985 to 21 November 1999 (Employment Period) and on all officers and servants of UWA and all students attending UWA (Bound Persons). 74 According to para 8 of the pleading, from 13 December 1971 to 22 July 1996 the Patents Regulations provided that each Bound Person was to inform the Vice-Chancellor immediately of any patentable invention made or developed wholly or in part during the course of that person's duty or while using UWA's research facilities (Prompt Notification Condition - reg 6.1: see [48] above) and if required by UWA, the inventor's rights in any invention so made or developed must be assigned to UWA (Assignment Condition - reg 6.3). 75 Paragraph 9 pleaded that from 22 July 1996 it was a condition of the IP Regulations that each Bound Person: 1. must promptly report the creation of any intellectual property likely to be commercially significant (Prompt Reporting Condition - reg 6.1); 2. must not apply for any form of protection for, or commercially exploit or otherwise deal with any intellectual property, or do any act or thing in a manner inconsistent with UWA's rights under the IP Regulations or otherwise (Restraint Condition - reg 4.11); 3. must not make any application (whether in Australia or overseas) for the registration of intellectual property otherwise than in the name of UWA, unless otherwise determined by the Pro Vice-Chancellor (Research & Innovation) (Naming Condition - reg 4.13); and 4. must execute any document or do anything reasonably required by UWA in relation to any intellectual property created by the Bound Person to demonstrate or prove UWA's ownership to third parties or to assist UWA to commercialise the intellectual property (Cooperation Condition - reg 4.8). 76 It was pleaded (para 10) that Dr Gray's contract of employment with UWA included express terms to the following effect: a) an obligation to undertake research and to organise and generally stimulate research among the staff and students of UWA; and b) the UWA Act and the statutes and regulations of UWA from time to time were imported into and formed part of the terms of employment. 77 Paragraph 11 of the pleading was that by reason of his employment by UWA, Dr Gray owed the following fiduciary duties to it: a) a duty to deal with the property rights and interests of UWA so as to protect and preserve that property and those rights and interests for UWA; b) a duty not to make any secret profit or receive any secret payment or obtain any secret benefit from any third party with whom he was dealing; c) a duty to account for any such secret profit or secret payment or benefit; and d) the duties of a trustee of such of UWA's assets or property as were in his possession or control and/or under his direction from time to time. We will call these pleaded duties "the Fiduciary Duties". 78 It was alleged that in the course of his work at UWA and within the scope of his employment by UWA, Dr Gray, alone or with others, "developed and/or discovered [the various inventions which] were patentable and commercially significant": paras 12, 36, 65. The SIRT-Spheres Inventions are pleaded to have been developed and/or discovered by Dr Gray alone, the DOX-Spheres Invention by either or both of Dr Gray and Dr Chen, and the Thermo-Spheres-1 Invention (we need not refer to the Thermo-Spheres-2 Invention or the Thermo-Spheres-3 Invention - see [6] above) by either or both Dr Gray and Dr Stephen Jones. 79 The filing of the various patent applications was pleaded. They and their identification of the applicants for the patents and of the inventors, as well as other contents of the applications and of the provisional or complete specifications, are documentary and uncontroversial. We discuss them below under the heading "Factual Background" when addressing the respective grounds of appeal relating to the three invention streams. 80 In relation to the two SIRT-Spheres Inventions, the DOX-Spheres Invention and the Thermo-Spheres-1 Invention, it is pleaded that Dr Gray breached the Prompt Notification Condition and the Prompt Reporting Condition. It is alleged that by making and maintaining the various patent applications and failing to comply with UWA's letter of demand, he breached various other conditions stipulated in the Patents Regulations and the IP Regulations referred to earlier. Finally, it was pleaded that by making and maintaining the various patent applications Dr Gray breached or is liable to account to UWA pursuant to various of the Fiduciary Duties. 81 The breaches of the Fiduciary Duties were pleaded to give rise to the consequence that Dr Gray held and holds on trust for UWA any right or entitlement obtained as a result of making the various patent applications, and, further or in the alternative, is liable to account to UWA for any benefit received by him as a result of his having done so: paras 17, 21, 26 (SIRT-Spheres); paras 41, 46, 51 (DOX-Spheres); paras 71, 81 (Thermo-Spheres-1). 82 The various assignments were pleaded: SIRT-Spheres on or about 29 April 1997 to Sirtex (para 28); DOX-Spheres from Drs Gray and Chen in about 1996 to CRI, and from CRI to Sirtex in about 1997 (para 52); and Thermo-Spheres-1 in or about 1997 to Sirtex (para 82). 83 The assignments are said to constitute further breaches by Dr Gray of the Restraint Condition and various of the Fiduciary Duties, and it is pleaded that as a result he held and holds the rights and entitlements he obtained as a result of making the assignments upon trust for UWA: SIRT-Spheres paras 29-33; DOX-Spheres paras 53-55; Thermo-Spheres-1 paras 83-90.

A GROUNDs OF APPEAL 1-5 and 8: term(s) implied by law and related matters

General 84 As will become apparent from the "Procedural history" below, the claims made, or permitted to be made, against Dr Gray evolved in an unusual fashion. The primary claims ultimately prosecuted by UWA, and rejected by French J, were founded upon a contractual term said to be implied by law into Dr Gray's contract of employment with UWA. 85 A precise formulation of the term was provided only on the third day of hearing of the appeal. The term was cast, first, as it would apply in Australian law in "a general contract of employment" and, secondly, as it applied in Dr Gray's case (this merely personalised to the parties the generally applicable term). It is sufficient for present purposes to refer only to the general term and the alleged basis of it. They are as follows: 1.A. Terms implied by law in the general contract of employment:- (a) An invention developed by an employee as a result of research carried out or caused to be carried out by that employee in the course of employment belongs to the employer such that the employee is a trustee of the invention for the employer. (b) The employer is entitled to any such invention made by the employee in the course of employment and the employee has an associated implied contractual obligation or an incidental equitable obligation to assign the benefit of any such invention to the employer. 1.B. Such terms will be implied by law in any contract of employment pursuant to which the employee is engaged or instructed or authorised to:- (a) solve technical problems; (b) improve the employer's technology; or (c) undertake research; from which such invention may arise. 86 As indicated above, this term was not included in the pleading before French J. Nor was any other implied term pleaded. UWA says, however, that the pleading as a whole enlivened the implied term issue, which was considered and determined by his Honour. In his Honour's view, the basis upon which the case was ultimately opened and as it was set out in closing submissions depended upon the contractual relationship between UWA and Dr Gray and on the fiduciary duties said to derive from his "employment": [1347]-[1351]. 87 The first five grounds of appeal relate either to his Honour's rejection of such a term or to the bases for his so doing. Ground 8 interacts with the alleged implied term. 88 Before considering the matters raised in this part of the appeal, we find it necessary to refer to a number of preliminary matters because of their considerable contextual importance or else because they indicate how legally and factually confined is the principal question that French J had to consider (and which this Court now has to consider). 89 We begin with the latter consideration which becomes evident from the procedural history of the matter.

Procedural history 90 The first basis upon which UWA claimed the benefits derived by Dr Gray by virtue of his being an inventor of the inventions in issue in this matter was for breach of fiduciary duties owed by reason of his employment by the University. The pleading itself is quite problematic. Suffice it to say that to the extent that it properly identifies alleged fiduciary wrongdoing, it is in relation to Dr Gray's dealings with property rights and interests owned or had by the University at the relevant times. But as French J indicated (at [327]): UWA did not plead in its statement of claim any implied term in Dr Gray's contract of employment that the benefit of any invention developed by him in the course of his employment belonged to UWA. The pleading seems rather to have proceeded upon the assumption of some unspecified mechanism whereby such inventions developed by him belonged to UWA. That mechanism was plainly not the patents regulations. They left open the question of UWA's rights in respect of inventions. In opening its case before the primary Judge, UWA in its written outline contended that the patents constituted property belonging to UWA "by operation of the [University's] statutes and regulations": [1348]. But in response to questioning from His Honour, counsel for UWA agreed with the proposition that UWA's rights "flowed entirely from its contractual relationship with Dr Gray": [1348]. 91 The Patents Regulations are considered separately below. What is to be noted is that at no point has UWA relied upon a term implied in fact as founding its right to the inventions: on the implied in fact/implied in law distinction see generally, Byrne v Australian Airlines Ltd (1995) 185 CLR 410 (Byrne); Cheshire and Fifoot's Law of Contract (9th Aust ed, 2008), 10.36 ff; Furmston (ed), The Law of Contract (3rd ed, 2007), 3.19 ff; Carter, Peden and Tolhurst, Contract Law in Australia (5th ed, 2007), [11-12] ff. Neither the evidence nor submissions have addressed such an implication. Whether or not such an implication could have been made out in a setting such as the present one is a matter on which we express no view at all. 92 On day 44 of the trial, UWA, by a proposed amendment to its reply to Dr Gray's defence, attempted for the first time to plead as an implied term of Dr Gray's employment contract that he owed to UWA a duty of good faith and fidelity. The amendment was disallowed: see [328]; on this duty and its difference from fiduciary duties, see University of Nottingham v Fishel [2000] ICR 1462; see also Stafford and Ritchie, Fiduciary Duties: Directors and Employees, Ch 4 (2008); Flannigan, "The [Fiduciary] Duty of Fidelity" (2008) 124 LQR 274 ("The duty of fidelity is a conceptual malformation": at 297). UWA's attempt at oblique resuscitation of this implied duty was abandoned during the hearing of the appeal. 93 For the sake of completeness, it should be noted as well that UWA has not sought to found any case on an alleged breach of confidence or to assert that Dr Gray owed a duty of confidence (implied contractual or equitable) to UWA. Finally, UWA appears to have accepted that its fiduciary claim is limited to a claim for misuse of UWA's property rights and interests and is not one of Dr Gray misappropriating an "opportunity" offered to UWA: cf Victoria University of Technology v Wilson (2004) 60 IPR 392 (Victoria University of Technology) at [150] ff. 94 We have emphasised above what this proceeding is not about, not to suggest that, differently pleaded, it may have had greater prospects of success (on which we express no view), but to indicate how narrow and in a sense contrived is the basis upon which this aspect of the matter has been fought and is to be decided.

UWA and its statutory setting 95 For reasons we later emphasise, both the character and purposes of UWA and the fact that it is a university are of no little importance in the proper disposition of the implied term aspect of the appeal. These are considerations of which French J was keenly aware and to which he attributed significance. UWA disputes the correctness of his Honour's so doing in two grounds of appeal: Grounds 2 and 3 (see below). Put shortly, but somewhat inexactly, UWA's position is that the primary Judge erred in differentiating between UWA as a university and other employers when identifying the appropriate reach of the common law's term implied by law governing employer entitlement to employee inventions. 96 The trial Judge set out at length the statutory framework and law making powers of UWA: see [21]-[34]. For present purposes it is sufficient that we note the following: (i) UWA was constituted as a special purpose statutory corporation in 1911. That form of entity is characteristic of all but a few Australian universities. UWA's purpose, as stated in the preamble to the UWA Act, is to provide "for further instruction in those practical arts and liberal studies which are needed to advance the prosperity and welfare of the people" of Western Australia. (ii) UWA consists of a Senate, Convocation, staff and graduate and undergraduate students: s 4. In consequence, we would note in passing, that Dr Gray was a member of UWA. Whatever significance such membership may have had in the proper characterisation of the nature of the relationship between UWA and its employed academic members, "none was argued": [22]. It is appropriate to say, though, that to consider Dr Gray's employment relationship with the UWA without taking account of his membership of it may have contrived the context in which the issues in this proceeding are to be resolved: see also [1361]. (iii) Subject to the UWA Act and statutes made by the Senate, the Senate has the power to appoint deans, professors, lecturers, etc and has "the entire control and management of the affairs and concerns of the University": s 13. The Senate's power to make statutes (s 31) extends to a variety of matters including: (a) the management, good government and discipline of the University; … (g) the number, stipend, manner of appointment and dismissal of deans, professors, lecturers, examiners and other officers and servants of the University; … (u) the control and investment of the property of the University; … (x) Generally all other matters not inconsistent with the provisions of this Act. The UWA Act provides a detailed procedure for the participation of Convocation in the statute making process: ss 31(2), (3) and (4). Statutes, moreover, are required to be approved by the Governor; must be laid before Parliament; and can be annulled in whole or in part by either House of Parliament: s 33. (iv) Section 16E conferred a regulation making power on the Senate. It provided: (1) The Senate, in the name and on behalf of the University, may, from time to time, make, alter and repeal regulations for the purpose of carrying out this Act, or any amendment thereof, or any Statute made by the governing body of the University, or for the purpose of securing and enforcing the management, good government and discipline of the University; and every such regulation shall be binding upon all deans, professors, lecturers, examiners, and all other officers and servants of the University and also on all students attending the University. Regulations so made do not, for present purposes, require the approval of the Governor and are not subject to disallowance by either House of Parliament. The Patents Regulations (approved by the Senate in December 1971) are in issue in this appeal. What is to be emphasised about s 16E(1) is that regulations made pursuant to it are made binding upon "deans, professors" etc by the terms of the UWA Act itself. (v) We will later refer to aspects of the UWA's operations and circumstances. What we would emphasise here is that UWA has been reluctant, perhaps understandably, to engage with the questions: "What is a modern university such as UWA and what are its purposes?" The University's focus was upon UWA as employer. Nonetheless, it is very obvious - and these at least are matters of which we can take judicial notice as they are evidenced in Acts of Parliament and parliamentary papers or are otherwise matters of common knowledge - Australian universities have changed dramatically in their number, and have evolved in character and relative diversity since the Second World War. There are many reasons for this, demographic and otherwise, but we would note, because of its present significance, the accelerated fostering of teaching and research in the natural sciences. Changed also are governmental expectations about how universities effectuate their public purposes and no more so has this been apparent from the 1980s than in how they have been expected (largely by the Commonwealth Government) to conduct - and finance - their operations. Werefer to aspects of this later in these reasons. In making these comments we are not suggesting that universities are a homogeneous species; that their place in the body politic is "unambiguous"; and that none of the tensions which affect them are inherent ones. As to the last of these, it has aptly been observed: "Universities house diverse, often rival, parishes": cf Steiner, Errata: An examined life (1997) 45. (vi) Dr Gray, in contrast to UWA, has emphasised the distinctiveness of universities and of the positions of academic staff within them. While there is little by way of direct evidence or of expert opinion on these matters, we are in effect invited to interpret what is in evidence by reference to characteristics conventionally associated with universities and their purposes. In particular, emphasis has been placed upon academic freedom as expressed in self-determined research, in the freedom to publish the results of research, in collaborations with researchers in other institutions and in academic staff mobility. To foreshadow matters, such concepts are an important presence in French J's reasons and in the considerations of policy to which we necessarily must turn.

The Patents Regulations 97 While we consider the Patents Regulations to be a distraction in this matter, we need to refer to them in some detail because they found one of UWA's grounds of appeal. We begin, though, with a further distraction. The Patents Regulations were approved by the Senate in 1971. In July 1996, the Senate purported to rescind them and to introduce the IP Regulations with immediate effect. Section 16E(2) of the UWA Act provides that a regulation takes effect "from the date of its promulgation in the University or from such later date as may be therein specified". On the evidence at trial it did not appear that the IP Regulations were in fact promulgated before 30 November 1997. Accordingly, French J held that the Patents Regulations were not rescinded until that time: [82]. The date is important. As noted at [66] above, after March 1997 Dr Gray was not employed by UWA to research or to invent: [1387]. UWA appealed against his Honour's conclusions on the IP Regulations. It abandoned that ground (Ground 9) at the hearing of the appeal.

(a) Relevant provisions of the Patents Regulations 98 It is necessary because of UWA's submissions to refer to the terms of the Patents Regulations at some length, notwithstanding that we agree with French J's conclusion that the Patents Regulations have no operative significance in this matter. 99 The Patents Regulations' preamble states: The purpose of University research is to advance knowledge and to make the benefits of such knowledge available to all. Although it is not the policy of University research specifically to seek patentable inventions, there can arise in the course of research inventions which in the interest of the public, the University and the inventor should be patented. The purposes of the University Patents Regulations are to define the procedures for determining which inventions resulting from University research should be patented, and to establish the procedures for obtaining patents without cost to the inventor and for dealing with them so as to safeguard the interests of the University and of the inventor in a manner consistent with the University's obligations to the public. [Emphasis added] The regulations applied, for present purposes, to all members of the staff of UWA: reg 2. Where financial support was offered from any outside person or body which might claim rights in any invention made or developed in the course of work undertaken with such support, the offer could not be accepted without the prior consent of the Vice-Chancellor and subject to such conditions as the Vice-Chancellor imposed: reg 3(1). The regulation went on: 3.(2) Any person authorised under the preceding sub-regulation to undertake work supported by any outside person or organisation, shall assign to the University such rights as may be necessary to enable it to exercise the inventor's rights in any invention made or developed with such outside support. 100 The Patents Regulations set up the Patents Committee in these terms: 4.(1) There shall be a Patents Committee appointed by the Senate to advise the Vice-Chancellor on all action to be taken in relation to inventions made or developed by persons subject to these regulations and in particular on - (i) whether the University should exercise its rights in such inventions; (ii) whether action to patent an invention once commenced should at any time be abandoned; (iii) whether the patent rights should be applied for in other countries and if not whether the right to do so should be assigned to the inventor; (iv) the action to be taken to negotiate the development of the patent and the terms of the arrangements to be made. (2) In considering matters referred to it by the Vice-Chancellor the Patents Committee shall consult the inventor. (3) Subject to approval of the financial implications by the Vice-Chancellor in each case, the Patents Committee may seek expert advice and employ the professional services of a Patents Attorney or other person. 101 As French J noted (at [40]), the power of the Vice-Chancellor in relation to inventions subject to the Patents Regulations was circumscribed by the requirement to act with the advice, or after the event the endorsement, of the Patents Committee: 5.(1) The Vice-Chancellor acting on the advice of the Patents Committee may act on behalf of the University in all matters relating to inventions made or developed by any person subject to these regulations: provided that this authority shall not extend the financial powers otherwise vested in the Vice-Chancellor. (2) In any case where the Vice-Chancellor deems it necessary to act without the advice of the Patents Committee he shall as soon as possible thereafter seek the endorsement of such action by the Patents Committee. (3) Should the Patents Committee refuse to endorse the action taken by the Vice-Chancellor under sub-regulation (2) the Vice-chancellor shall report the matter to the Senate for directions. 102 The operative provision for staff subject to the Patents Regulations was reg 6: 6.(1) Any person subject to these regulations shall immediately inform the Vice-Chancellor of any patentable invention made or developed wholly or in part during the course of that person's duty or whilst using the University's research facilities. (2) The Vice-Chancellor shall refer any report received under sub-regulation (1) to the Patents Committee and, acting on the advice of the Committee, shall inform the inventor as soon as possible, and not more than sixty days after receiving a written request to do so, whether or not the University will exercise its rights in the invention. (3) If the University decides to exercise its rights in the invention, the inventor shall assign his rights therein to the University. (4) If the University decides not to exercise its rights in the invention, the University shall assign its rights therein to the inventor. We would note in passing that the proper construction of reg 6(1) was a matter of extended debate on the appeal. 103 Regulation 7(1) provided that if UWA decided to exercise its rights in an invention, the Vice-Chancellor was to cause a patent application to be made as soon as reasonably possible and stated: "… the inventor shall not publish the invention until after the application for the patent has been lodged." It is to be noted that the prohibition against publication so imposed on the inventor was, at least in its express terms, prospective only. It was contingent on the Patents Regulations mechanism being brought into play and UWA's deciding to exercise its rights in the invention - events that did not occur in the present case. 104 Finally, regs 9 and 10 provided respectively for a return to the inventor from any profits from the invention's exploitation and for the University's profits thereon to be set aside for research. 105 Justice French concluded - correctly in our view - that regulations made under s 16E of the UWA Act are a lesser form of delegated legislation than statutes and that UWA could not, by regulation, acquire property from its staff members. UWA has not challenged either of these conclusions. His Honour further considered that the incorporation of UWA's statutes and regulations into staff contracts is posited on the former's validity: [84]-[90].

(b) The demise of the Patents Committee and its consequence 106 The Patents Regulations were operative at UWA when, on 26 October 1984, Dr Gray signed his acceptance of the office of employment to which were appended his conditions of employment. Those conditions stipulated that he was to be subject to "the University Act, the Statutes and the regulations of the University". There are "sprinklings of fact" that he was aware of the Patents Regulations. But in any event he was bound by them when he became a member of staff of UWA, not only by virtue of the provisions of s 16E(1) of the Act, but also by his signing the contract of employment: Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165. 107 Nonetheless, French J concluded that because of UWA's actions and inaction from 1985 in effectively abandoning the Patents Committee structure, the "mechanisms for assessing inventions for commercial development … could not operate". His Honour said (at [257]): UWA can be regarded as having had a reciprocal obligation to establish the mechanism under the regulations for providing a prompt response to an inventor's notification. That reciprocal obligation having been abandoned, a necessary condition of the existence of the inventor's obligation was removed. UWA failed to maintain the mechanism necessary for the performance of the obligations said to have been imposed upon its staff by importation into their contracts of the terms of the Regulations. This conclusion affects UWA's claims against Dr Gray for breach of contract up to 30 November 1997. 108 That conclusion was based upon his Honour's examination of historical documentary material, UWA's actions in relation to the potential exploitation of inventions, and the evidence of UWA's senior officers (including the Vice-Chancellor, the Deputy Vice-Chancellor (Research) and the Pro Vice-Chancellor (Research and Innovation)): see the "Summary of findings" at [246]. His Honour crystallised the effect of his findings as follows (at [256]): UWA should be taken to have decided, after 1988, not to appoint a patents committee at all. The possibility that a committee could be appointed on an ad hoc basis to respond to reports of particular inventions was never considered. Indeed, UWA moved down an alternative pathway using Uniscan and CABR, the Deputy Vice-Chancellor (Research) and later the Pro Vice-Chancellor (Research) to provide a framework within which inventions could be commercialised. UWA depended upon approaches by staff interested in commercialisation. The activities of these entities were not posited on a legal obligation on staff members to bring matters to them. As noted earlier, UWA caused Uniscan to be incorporated in 1976. That was on the recommendation of the Patents Committee: [169]. Also as noted earlier, CABR was established in 1982-83 and was operated in conjunction with Uniscan: [170]. Justice French found that the Patents Committee did not meet after 25 October 1985 and, although remaining formally constituted until 1988, it ceased to exist thereafter: [167].

(c) Appeal Ground 8 109 It is UWA's contention expressed in Appeal Ground 8 that the absence of a formal Patents Committee did not have the consequence that the Patents Regulations - (a) were excised from Dr Gray's contract of employment; or

(b) ceased to be binding on Dr Gray so releasing him from his obligation under those Regulations. 110 In submissions UWA challenged the factual finding that the Patents Committee ceased to exist in 1988, by reference to a memorandum of 7 November 1989 sent by the Deputy Vice-Chancellor (Research) to deans, heads of divisions and departments and directors of centres concerning the availability of an outside company to provide advice on intellectual property matters. That letter was copied to a number of persons including "Secretary [unnamed], Patents Committee". 111 In light of: (a) the evidence given by the relevant senior officers of UWA at the time: (i) Professor Parfitt, Deputy Vice-Chancellor (Research), 1987-1991: Did you join the Patents Committee?---I cannot recollect attending a single meeting of the Patents Committee, because I was told at the time [of my appointment] that it was effectively defunct; (ii) Professor Barber, Pro Vice-Chancellor (Research and Innovation) from 1994 to 2002, to the effect that he was never appointed to the committee and knew nothing of its existence; (b) the lack of documentary evidence relating to meetings or the composition of the Patents Committee subsequent to 1985; (c) the unexplained copying of the 1989 memorandum to the unnamed "Secretary, Patents Committee"; and (d) Justice French's detailed examination of the evolution and implementation of UWA's intellectual property policy from 1985-2002: see [165]-[238], we consider that the evidence supporting the conclusion that after 1988 the Patents Committee ceased to exist was overwhelming. That there was a person in 1989 who had the formal title of Secretary to the committee may or may not have been the case. We are in no position to conclude it was the case. But even if it was, this in no way undermines his Honour's conclusion which was, on the evidence, an inevitable one. 112 UWA further contended that even if there was no formal committee in existence, the Patents Regulations did not cease to exist as subordinate legislation of UWA binding on Dr Gray and, in any event, the committee was not a necessary precondition to the enforcement of the regulations. If the Vice-Chancellor had been notified by an inventor, a "Patents Committee" could have been convened to act. 113 The last of these propositions is notable for its unreality. Not only was the use of an ad hoc committee not considered (not surprisingly, given it was a creature of the Senate, not of the Vice-Chancellor) but also, and more importantly, UWA had moved down an "alternative pathway" to provide a framework within which inventions could be commercialised: [256]. To put the matter colloquially, the Patents Regulations were no longer part of UWA's agenda and UWA acted accordingly. 114 The contention that the Patents Regulations continued to exist notwithstanding the non-existence of the Patents Committee does not assist UWA's case. It may be accepted that a statute does not cease to exist just because it has fallen into disuse (see R v Riley [1973] 2 NSWLR 107 at 111; R v London County Council; ex parte The Entertainments Protection Society [1931] 2 KB 215 (Entertainments) at 225 and 242). It may, however, become obsolete in the sense that the conditions necessary to activate its provisions no longer exist: Entertainments at 242. "Obsolescence" in this latter sense seemingly connotes that circumstances exist that make the law impracticable or impossible to apply. Historically a like rule has been applied to the by-laws of statutory and chartered corporations. So in Grant, Practical Treatise on the Law of Corporations (1850) 90 and 91, it is said that: Evidence of a practice in contravention of a bye-law is said not to be receivable to invalidate the bye-law … As regards the repeal of bye-laws, it appears that the only mode of abrogating a bye-law which is within the scope and object of the constitution of the corporation which passes it, and which is not unreasonable or contrary to law, is by act of parliament, if the corporation refuse to repeal it: a bye-law is never obsolete. 115 We accept, as evidently did French J, that notwithstanding UWA's abandonment of the mechanism for assessing inventions mandated by the Patents Regulations, the Regulations retained their character as such until they were rescinded in November 1997: [82]. 116 Rather, as French J indicated, UWA's claim was founded on Dr Gray's alleged breach of his contractual obligation to perform his obligations under the Patents Regulations. To repeat what his Honour said (at [257]): UWA failed to maintain the mechanism necessary for the performance of the obligations said to have been imposed upon its staff by importation into their contracts of the terms of the Regulations. This conclusion affects UWA's claims against Dr Gray for breach of contract up to 30 November 1997. 117 Though the parties have not addressed explicitly the contractual significance of this failure on the part of UWA, it is, in our view, implicit in French J's findings that his Honour considered that UWA was required to maintain the Patents Committee mechanism in the sense that its maintenance was a contingent condition of Dr Gray's contractual obligation to inform the Vice-Chancellor as required by reg 6(1); and that the non-fulfilment of that condition excused Dr Gray from performance of that contractual obligation: cf Maynard v Goode (1926) 37 CLR 529 at 540; Cheshire and Fifoot's Law of Contract, 20.1-20.2. Maintenance of the Patents Committee mechanism was not the subject of a promissory term but was simply a condition of the enlivening of Dr Gray's own promise: see Carter, Peden and Tolhurst, Contract Law in Australia (5th ed, 2007)at [13.16]-[13.19]. 118 Weagree with the conclusion so reached. For the sake of completeness, weshould say wedo not consider that the requirement that UWA maintain the Patents Committee mechanism was promissory so that its failure to do so was a breach of contract. This was not suggested by French J. 119 A consequence of our conclusion is that Ground 8 of the grounds of appeal (see [109] above) cannot be sustained. As we foreshadowed, the Patents Regulations controversy is a distraction. As French J found, and the finding has not been contested, the Patents Regulations could not validly appropriate property to UWA which did not belong to it: see [90]-[93]. In any event, even if Dr Gray did (contrary to our conclusion) breach his contract by not complying with reg 6(1), that breach could have attracted only an award of nominal damages. UWA has conceded that it did not seek to prove that substantial damage was suffered by reason of that breach.

Dr Gray's conditions of employment 120 By letter of 8 August 1984 the then Vice-Chancellor acting on behalf of the Senate offered Dr Gray an appointment to the Chair of Surgery in UWA's Department of Surgery. He was informed at the time that if he accepted the offer he would be granted clinical status and admission to practice by the board of management of RPH. 121 So began a period of negotiation with UWA which French J detailed in his reasons at [315]-[318]. For present purposes it is sufficient to note that Dr Gray's central concerns were what he regarded as minimum basic infrastructure requirements for the Department of Surgery at RPH, an establishment grant of approximately $120,000 for the purchase of laboratory equipment to re-establish his ongoing research projects in Perth, and his insistence, if he were to accept the appointment, that a position be found for Dr Burton, who was "the key scientist in our main research program at St Vincents" in Melbourne. Since 1983 Dr Burton had had the day-to-day responsibility for all of Dr Gray's research projects. In the event, Dr Burton was provided with a research fellowship in the Department of Surgery. We refer to this simply to illustrate an aspect of the University environment in which Dr Gray was participating and in which he would conduct his research - matters to which we return below. 122 Dr Gray accepted UWA's offer of employment on 26 October 1984, the position to be taken up on 1 January 1985. The conditions of his employment included the common form conditions governing permanent appointments to chairs. The relevant condition for present purposes related to his duties as a professor. It provided: 1. DUTIES A Professor will be a full-time officer of the University and will be required to devote his whole time to his University duties except in so far as he undertakes private and consultative work (as to which see cl 11). He will be responsible where applicable to the Head of the Department and will be required - (i) to teach, to conduct examinations and to direct and supervise the work in his field in accordance with the Statutes and regulations of the University and the directions of the Senate; (ii) to undertake research and to organise and generally stimulate research among the staff and students; and (iii) to perform such other appropriate work as the Senate from time to time determines. [Emphasis added] The burden of the formula "to undertake research", as will be seen, is very much in issue on the appeal. 123 It should be emphasised that UWA's claim in contract has focussed almost exclusively on Dr Gray's duty to undertake research. While this may be understandable given the subject matter of the claims made, it rather contrives the context in which his function and his responsibilities to UWA fall to be analysed and characterised. As the Professor of Surgery, Dr Gray had teaching and supervisory responsibilities to students. The extent to which the proper discharge of those responsibilities by a person in Dr Gray's position could or would require the sharing and dissemination of research results etc was not a matter raised before us, or, seemingly, before French J. It is almost unnecessary to add that it is the coalescence of teaching (with its dissemination of knowledge) and research (with its generation of knowledge) that is so characteristic of universities and (save in the case of the university researcher with no teaching responsibilities at all) differentiates the university academic from the researcher in private enterprise. 124 UWA has accepted both at trial and on the appeal that there was no express or implied contractual obligation imposing on Dr Gray a "duty to invent". In oral submissions it was said that by this concession all that was signified was that there was no contractual requirement that he make patentable inventions. But to anticipate matters, relying upon one of the various meanings of "invention" discussed in patent cases and texts (see Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd (2001) 207 CLR 1 at [20]-[21]), UWA now contends that, at least in the applied sciences, the duty to invent is relevant to a duty to research in the sense that the latter comprehends "a duty to make advances in the art" and that such a duty is, in fact, a duty to invent. It should be said that this was not the manner in which this issue was presented to French J. It emerged only in response to questioning on the appeal. Moreover, we take judicial notice of the fact that there are university researchers in the sciences who may carry out research without aiming for or achieving a patentable invention.

Aspects of Dr Gray's employment 125 A major part of French J's judgment was devoted to the course of Dr Gray's activities while employed at UWA, his interactions with other scientists and researchers, and his dealings with UWA's senior officers: see [329]-[1109]. For the purposes of this aspect of the appeal it is only necessary for us to emphasise several aspects of his Honour's detailed narrative. The evidence reveals recurrent general themes which clearly informed his Honour's findings and which are directly relevant to this appeal. 126 (i) As the negotiations leading to Dr Gray's acceptance of the position at UWA demonstrate, Dr Gray's research work was conducted using a research team. Doctoral and post-doctoral researchers were engaged to conduct research of varying particularity. Their funding arrangements and employment status (with UWA or another body) varied. Equally, relevant research and experimentation were conducted through arrangements with other institutions - CSIRO, Monash University, etc - or with the assistance, sometimes significantly so, of researchers in other institutions, eg Dr Hodgkin of CSIRO. These engagements, collaborations, etc, we would note, reflected Dr Gray's own initiatives and were not the result of directions to him from UWA. 127 (ii) The primary Judge's chronicle of the comings and goings of participants in Dr Gray's research teams reveals the mobility (often enforced for funding reasons) of particularly junior academics/researchers. When this is considered, together with the extensive collaboration with, or utilisation of the services of, researchers in other institutions, several other characteristics in the evidence emerge. Knowledge/information of varying degrees of significance to a research project of Dr Gray may have been generated before a particular researcher joined his team; may have been generated by a member of the team who was not an employee of, or funded by, UWA; or may have been provided to a team member by way of scholarly exchange or assistance by a stranger to the project who was employed by another institution. 128 (iii) The collaboration in research was reflected in the production of multi-authored journal articles and papers that dealt with research results, clinical trials, etc, although sole authored pieces by members of the research group were also not uncommon. The publications appeared in quite some number and his Honour noted many of these: eg in relation to SIR-Spheres, see [426], [431] and [434]. Further, Dr Burton gave evidence of the "Gray group's" commitment to the dissemination of research first in Melbourne and then in Perth (at [483]-[484]): There was in the Melbourne group a strong commitment to the publication and dissemination of research results for the sake of developing new treatments and new approaches to cancer management. All of the research and the results of the work undertaken in Melbourne were presented in general and public forums within the department, the university, at research meetings and conferences without any concern about the disclosure of the new methodologies. I accept his evidence in that respect. According to Dr Burton that approach continued after the move to Perth. Again, I accept his description of the general approach to disclosure during his time with Dr Gray's team in Perth. He and Dr Gray had given conference presentations to the Australian and New Zealand Surgical Research Society on the SIR-Spheres work before and during 1985. In 1986-87, Dr Burton presented work to the Australian Physiological and Pharmacological Society on the use of microspheres in liver cancer. Dr Cameron Jones presented on the manufacture of drug microspheres and releases of the drug from the particles. Dr Burton and Dr Gray also made representations in 1988 to the Cancer Research Foundation of Western Australia in the hope of attracting its funding support. They presented papers to the Cancer Research Assn of Western Australia. These related, inter alia, to dosimetry used for selective internal radiation therapy and the methodology and therapeutic responses associated with Adriamycin exchange resins. Presentations they made in 1989 covered the extension work which they had been performing using the same microsphere techniques but using heat to increase the release and therapeutic effects of the agents concerned. In that year the Cancer Foundation of Western Australia provided the group with project funding. They also received support from the RPH Research Foundation. 129 We would note in passing that in French J's view, at all presently relevant times there was no prohibition expressed or to be implied that would prevent Dr Gray from publishing the observations and discoveries he had made and details of the technologies he had developed: [1360]. We will refer later refer to UWA's quite limited challenge to this as also to his Honour's comment (at [160]) that: Given the nature of universities and the public purposes served by such as UWA, there is no basis for implying into the contracts of employment of its academic staff a duty not to disclose the results of research even if such disclosure could destroy the patentability of an invention. 130 (iv) As French J commented (at [161]): A striking feature of this case was the significant amount of time and effort devoted by Dr Gray and those researching with him in applying for research grants to a myriad of funding and grant bodies and agencies. 131 An index to Research Grant Applications handed up during the hearing is testament to the volume of grants applied for by Dr Gray or by members of his team. Annex 2 to French J's reasons is a list of 41 successful applications of that kind made to the NH&MRC. To illustrate the point further, Dr Burton gave evidence of the sources of funding allocated to Dr Gray's group for microsphere research generally for the years 1985-1988: Two were UWA grants, six were from RPH, two from the RPH Research Foundation, one from the CSIRO/UWA Collaborative Research Fund, three from the national Health and Medical Research Council, one from the Cancer Foundation of Western Australia and one from the Medical Research Fund of Western Australia. Relatedly, and notably in 1989-1990, Dr Gray was an instigating force in the establishment shortly afterwards of two incorporated institutes involved directly in the support of his research program, LCI and CRI: Broadly the division of their roles was that the LCI provided funding for equipment and staffing of the research program. Funds from the CRI supplemented funds from conventional external funding bodies. The LCI adopted as its primary focus for research support the targeted microsphere technology which was the subject of the work being done by Dr Gray and his group: Reasons [615]. 132 Finally, Dr Gray's endeavours to commercialise the targeted microsphere technology began with his dealings with UWA's Uniscan and CABR in the late 1980s: see [466]-[482]. These were unavailing. Uniscan had not proved to be a source of any significant funding: [1371]. Dr Gray later made approaches to various commercial partners, again unsuccessfully. By mid-1994 he was seeking venture capital support. 133 (v) In his reasons (at [1362]) French J commented that "the contemporary reality is that most, if not all, universities, including UWA, engage in commercial activities". But he went on to make plain that he was not characterising a university as such as a commercial enterprise pursuing commercial purposes. Though his Honour has been challenged by UWA for taking judicial notice of the commercial activities of universities, he was entitled to do so. By at least the 1990s the governmental incentive for universities in some degree to "commercialise" - a word of many colours - was a matter of notoriety. The evidence to which we were taken, or which is recited in French J's reasons, concerning UWA's commercial activities related in the main to Uniscan and CABR. That evidence was patchy indeed and not particularly illuminating. The most significant evidence, because it related to the Patents Regulations and the IP Regulations, comes from Professor Barber's affidavit (para 48): The philosophy that underpinned UWA's approach to intellectual property and commercialisation at the time at which CACS was established [ie mid 1990s] and through to at least 1999, under both the Patent Regulations and the [IP] Regulations, was not commercially focussed. It was focussed on matters such as gaining research funding, the support of PhD students and, above all, kudos and reputation from academic publication in the peer-reviewed literature. The commercialisation of intellectual property was in effect a "by-product" of this and there were only a few examples of any substantial commercialisation during this period. CACS was a collaborative research centre involving UWA, LCI and CRI. Dr Gray was relocated to it in 1996. 134 Uniscan was deregistered under the Corporations Law in 1993 or early 1994 (see [33] above).

Applicable legal principles 135 We will refer, first, to the general principles governing the implication of a term by law into a contract and, then, to the specific considerations applying to the implication of a term into an employment contract such as would entitle the employer to an invention made by the employee.

Terms implied in fact are individualised gap fillers, depending on the terms and circumstances of a particular contract. Terms implied in law are in reality incidents attached to standardised contractual relationships, or perhaps more illuminatingly, such terms can in modern US terminology be described as standardised default rules": Society of Lloyds v Clementson [1995] CLC 117 at 131. See also Byrne at 447 ff; and generally, Furmston (ed), The Law of Contract (3rd ed, 2007), 3.21-3.25; Cheshire and Fifoot's Law of Contract (9th Aust ed), 10.50-10.54; Carter, Peden and Tolhurst, Contract Law in Australia (5th ed, 2007), [11-12]-[11-16]; Peden, "Policy Concerns Behind Implication of Terms in Law" (2001) 117 LQR 459 where this subject is helpfully analysed. 136 We begin with what is well accepted. (i) Terms implied in law are "legal incidents of the particular class of contract" to which they respectively relate: Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 345. They are to be found in many commonly occurring types of contract - sales, employment, landlord and tenant, doctor-patient, etc. (ii) They are not based upon the intention of the parties, actual or presumed, in a given instance, although the provenance of a particular term may well have been the commonplace use of such a term in earlier times in contracts of that type, so establishing what later would become the default rule: see Byrne at 449. (iii) Neither are they founded on the need to give efficacy to a contract: Codelfa Construction at 345; although, as has often been recognised, there can be a deal of overlap between terms implied in law and terms implied in fact in particular contractual settings: see eg Hughes Aircraft Systems International v Airservices Australia (1997) 76 FCR 151 (Hughes Aircraft Systems International) at 193. While implication in law is also said to be based on "necessity", that necessity, as will be seen, is informed by "more general considerations than mere business efficacy": Lister v Romford Ice and Cold Storage Co Pty Ltd [1957] AC 555 (Lister) at 576. (iv) Implication of a term in law yields to the contrary intention of the parties as expressed in their contract or because of inconsistency with the terms that have been agreed: Castlemaine Tooheys Ltd v Carlton & United Breweries Ltd (1987) 10 NSWLR 468 (Castlemaine Tooheys) at 492B-C; Shell UK Ltd v Lostock Garage Ltd [1977] 1 All ER 481 (Shell UK) at 487. 137 The matters that need to be considered for present purposes are, first, the requirement that there be a recognised or commonly occurring class, type, or kind of contract: Breen v Williams (1996) 186 CLR 71 (Breen) at 103; Shell UK, at 487; and, secondly, the test to be satisfied if the implication is to be made. 138 The class requirement has been recognised in many cases. All that needs to be emphasised about it here is that it can be formulated and satisfied at differing levels of generality depending upon the nature of the implication sought to be made. So while one type of term may quite appropriately be implied in a class of contract cast in very general terms, eg in a contract of employment the employee's duty to obey lawful and reasonable directions given by the employer that fall within the scope of the employment (eg McManus v Scott-Charlton (1996) 70 FCR 16 at 21; Macken's Law of Employment, [5.360] (6th ed, 2009)), another term may be of such a character as to be implied only into a recognisable sub-category of that larger class. In Scally v Southern Health and Social Services Board [1992] 1 AC 294 (Scally), for example, a term was implied into an employment contract obliging the employer to give notice to its employees of changes to their contributory pension scheme, but this implication was limited to a sub-category or type of contract having quite particular characteristics. As Lord Bridge commented (at 307): I would define it [the sub-category] as the relationship of employer and employee where the following circumstances obtain: (1) the terms of the contract of employment have not been negotiated with the individual employee but result from negotiation with a representative body or are otherwise incorporated by reference; (2) a particular term of the contract makes available to the employee a valuable right contingent upon action being taken by him to avail himself of its benefit; (3) the employee cannot, in all the circumstances, reasonably be expected to be aware of the term unless it is drawn to his attention. On sub-categories see eg Hughes Aircraft Systems International, "(government tender process contract"); Spring v Guardian Assurance plc [1994] 3 All ER 129 at 178-179; and see, generally, Peden, at 460-465. The matter to be emphasised for present purposes is that it is a case of the sub-category variety that is in issue in this appeal. UWA accepts that the implied term it is propounding is not one to be implied in every employment contract. 139 There has been a degree of uncertainty, and increasing controversy, as to the burden of the test to be applied - if there be a single test - in making an implication in law. What is presently clear is that the implication requires a justification greater than merely that of "reasonableness": see Scally at 215; Castlemaine Tooheys at 488-489; but see also Crossley v Faithful & Gould Holdings Ltd [2004] 4 All ER 447 (Crossley) at [33]-[36]; for the different position in US jurisprudence see Restatement of Contracts, Second, s204. Something more is needed. The test most commonly stated or asserted is that of "necessity". This test, which has been referred to approvingly on a number of occasions in the High Court (see eg Byrne at 450; Breen at 103 and 124), had its modern provenance in observations of Lord Wilberforce in Liverpool City Council v Irwin [1977] AC 239 (Liverpool City Council) at 254. At issue in that case were the alleged contractual obligation of a landlord to repair and maintain the common areas of a high-rise residential dwelling. Lord Wilberforce characterised the court's concern as being - Simply … to establish what the contract is, the parties not having themselves fully stated the terms. [Emphasis added] Lord Wilberforce went on: There can be no doubt that there must be implied (i) an easement for the tenants and their licensees to use the stairs, (ii) a right in the nature of an easement to use the lifts, (iii) an easement to use the rubbish chutes. But are these easements to be accompanied by any obligation upon the landlord, and what obligation? There seem to be two alternatives. The first, for which the council contends, is for an easement coupled with no legal obligation, except such as may arise under the Occupiers' Liability Act 1957 as regards the safety of those using the facilities, and possibly such other liability as might exist under the ordinary law of tort. The alternative is for easements coupled with some obligation on the part of the landlords as regards the maintenance of the subject of them, so that they are available for use. My Lords, in order to be able to choose between these, it is necessary to define what test is to be applied, and I do not find this difficult. In my opinion such obligation should be read into the contract as the nature of the contract itself implicitly requires, no more, no less: a test, in other words, of necessity. The relationship accepted by the corporation is that of landlord and tenant: the tenant accepts obligations accordingly, in relation inter alia to the stairs, the lifts and the chutes. All these are not just facilities, or conveniences provided at discretion: they are essentials of the tenancy without which life in the dwellings, as a tenant, is not possible. To leave the landlord free of contractual obligation as regards these matters, and subject only to administrative or political pressure, is, in my opinion, inconsistent totally with the nature of this relationship. The subject matter of the lease (high rise blocks) and the relationship created by the tenancy demand, of their nature, some contractual obligation on the landlord. I do not think that this approach involves any innovation as regards the law of contract. The necessity to have regard to the inherent nature of a contract and of the relationship thereby established was stated in this House in Lister v Romford Ice and Cold Storage Co Ltd. [Emphasis added] 140 It doubtless is the case that this necessity test - and its characteristic concern with whether the enjoyment of contractual rights could be rendered nugatory or worthless, or be seriously undermined if no implication is made - has been invoked to address the broad range of instances where the issue of such an implication ordinarily arises: eg Byrne at 450; Breen at 103 and 124; Castlemaine Tooheys at 488-489; and see the extended list of examples given Glanville Williams, "Language and the Law", (1945) 61 LQR 71 at 403. 141 However, the difficulty with the test, particularly if it is narrowly conceived, inheres in the term "necessity" itself. As Dyson LJ indicated in Crossley (at [35]-[36]), "necessity" is "an elusive concept": it is often by no means clear in what sense it was "necessary" to have made the implication in decided cases. 142 What is clear is that necessity in this context has a different shade of meaning from that which it has in formulations of the business efficacy test: see generally Treitel, The Law of Contract, at 6-042 (12th ed, 2007). The principal reason for this is, as Viscount Simonds indicated in Lister (at 576), that implication in law rests "upon more general considerations", a view endorsed both by Lord Wilberforce in Liverpool City Council at 255 and by Lord Bridge in Scally at 307. Those more general considerations require that regard be had "to the inherent nature of the contract and of the relationship thereby established" as both Lister and Scally make plain. But those very considerations themselves can raise issues of "justice and policy" (cf Star Shipping AS v China National Foreign Trade Transportation Corporation (The Star Texas) [1993] 2 Lloyd's Rep 445 at 452; Hughes Aircraft Systems International, at 194-197) as well as consideration, not only of consequences within the employment relationship, but also of social consequences: see Lister at 579. 143 Lister illustrates the significant role that public policy can have in the matter. In a passage often referred to in this country when distinguishing implications at law from those necessary to give business efficacy to a particular contract, Viscount Simonds observed (at 576): [T]he real question becomes, not what terms can be implied in a contract between two individuals who are assumed to be making a bargain in regard to a particular transaction or course of business; we have to take a wider view, for we are concerned with a general question, which, if not correctly described as a question of status, yet can only be answered by considering the relation in which the drivers of motor-vehicles and their employers generally stand to each other. Just as the duty of care, rightly regarded as a contractual obligation, is imposed on the servant, or the duty not to disclose confidential information … , or the duty not to betray secret processes … , just as the duty is imposed on the master not to require his servant to do any illegal act, just so the question must be asked and answered whether in the world in which we live today it is a necessary condition of the relation of master and man that the master should, to use a broad colloquialism, look after the whole matter of insurance. If I were to try to apply the familiar tests where the question is whether a term should be implied in a particular contract in order to give it what is called business efficacy, I should lose myself in the attempt to formulate it with the necessary precision. The necessarily vague evidence given by the parties and the fact that the action is brought without the assent of the employers shows at least ex post facto how they regarded the position. But this is not conclusive; for, as I have said, the solution of the problem does not rest on the implication of a term in a particular contract of service but upon more general considerations. [Emphasis added] Viscount Simonds later went on to discuss - and accept (at 579) - the contention that a term should not be implied "of which the social consequences would be harmful": see the discussion of this case in Treitel, at 6-043 and Gummow J's citation of Treitel's views on implication in Breen at fn 192. 144 The necessary tie between implication in law and considerations of policy has been widely acknowledged in recent times both in English and Australian case law and in scholarly writings. In England in particular this has been associated with an attack on the utility of "necessity" as a descriptor of the test actually being applied in the cases: see eg Crossley at [33]-[36]; Treitel, 6-042; Furmston (ed), 3.24; and see generally, Peden, 465 ff. 145 In Simonius Vischer & Co v Holt & Thompson [1979] 2 NSWLR 322 at 348, Samuels JA suggested that the imposition of terms as a matter of law amounts to no more than the imposition of a legal duty where the law thinks policy requires it: for subsequent views to the same or like effect see eg Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 at 261; Vodafone Pacific Ltd v Mobile Innovations Ltd [2004] NSWCA 15 at [187]. While Samuels JA's observations provide little guidance in shaping the judicial inquiry in individual cases, they helpfully acknowledge that considerations of policy can, and do, have a part to play in determining whether or not it is necessary that a contractual obligation should be implied in law in a given class of contract. The obligation of secrecy imposed upon professionals by virtue of their relationships with their clients and its varying scope from profession to profession, clearly illustrate this: see eg Tournier v National Provincial and Union Bank of England [1924] 1 KB 461 at 474; Parry-Jones v Law Society [1969] 1 Ch 1 at 7, 9. 146 There is one matter calling for emphasis. It is that considerations of policy, as Lister illustrates, can be of considerable significance in negativing the making of an implication, or else in demonstrating that the issues raised by the proposed implication are of such a character or complexity as to make it inappropriate for a court, as distinct from a legislature, to impose the obligation in question: see eg Reid v Rush and Tompkins Group plc [1990] 1 WLR 212 at 220. As will be seen, "more general considerations" play an important part in dissuading us from allowing this aspect of the appeal and from making the implication sought. 147 There are two final comments to be made. The first is that it is not appropriate in this appeal for us to venture a view upon whether the necessity test ought be discarded. That is for the High Court. What we have had to say of its presently permitted latitude is sufficient for present purposes. Secondly, we note that this is an area of law in which little direct assistance can be obtained from United States jurisprudence or from the provisions of transnational instruments: cf Restatements of Contracts, Second, s 204; Farnsworth, "Disputes over Omission in Contracts", (1968) 68 Colum L Rev 860; and see eg UNIDROIT Principles of International Commercial Contracts, Arts 4.8 and 5.1.2. What can be said, though, is that there is apparent acceptance both in judicial decision and in legal scholarship in the United States that when terms are implied by law (a description which includes what in our jurisprudence are implications in fact: Farnsworth on Contracts, s 7.16 (3rd ed, 2004)), that implication can be for reasons of justice, fairness and policy: see eg NEA-Coffeyville v Unified School District No 445 996 P. 2d 821 at 830-832 (Kan 2000); Farnsworth on Contracts, s 7.16 at 351.

(b) Implied terms and employee inventions 148 Neither party contends that French J erred in his extended comparative analysis of, or in his conclusions upon, the common law relating to employee inventions: [112]-[157]. In these circumstances it is unnecessary that we essay a like survey of the law, although it will be necessary, given the nature of the errors now ascribed to his Honour, to emphasise certain aspects of the common law in relation both to employee inventions and employee secrecy. 149 We would add by way of preface that we are aware of both the shifts in emphasis and the tensions that have attended the evolution of the principles we are about to discuss. We note in particular that there has over time been a tendency at common law to increase the presumption of ownership in favour of the employer: see Cornish and Llewellyn, Intellectual Property: Patents, Copyright, Trade Marks and Allied Rights, 7-03 (6th ed, 2007). For a more traditional view more favourable to employees, see Re Marshall and Naylor's Patent (1900) 17 RPC 553. There continue to be tensions between a variety of employment-related implied terms and general equitable principles, particularly fiduciary ones: see eg Vokes Ltd v Heather (1945) 62 RPC 135 (Vokes) at 141-142; British Celanese Ltd v Moncrieff [1948] Ch 564 at 167. Given UWA's grounds of appeal, it is unnecessary to explore these matters. We should emphasise, though, for the sake of completeness, that we have not considered at all any bearing that an employee's duty of fidelity allegedly may have on an employer's entitlement to claim an employee's invention: cf Monotti & Ricketson, Universities and Intellectual Property, 5.58-5.59 (2003); Dean, The Law of Trade Secrets and Personal Secrets, Ch 5 (2nd ed, 2002); Poole, "Employee's Rights in Respect of Patent, Designs and Copyright Material", (1979) 3 Auckland U.L. Rev 355. As already noted, UWA's late attempt to plead such a duty was refused. 150 As both parties have sought to rely upon the observations of Nettle J in Victoria University of Technology on implied terms and the ownership of inventions, we take them as our starting point. As his Honour acknowledged, his observations crystallise the leading English authorities on this subject which have been accepted in this country (at [104]): The law is well settled upon the position of an officer or employee who makes an invention affecting the business of his or her employer. It is an implied term of employment that any invention or discovery made in the course of the employment of the employee in doing that which he is engaged and instructed to do during the time of his employment, and during working hours, and using the materials of his employers, is the property of the employer and not of the employee. Having made a discovery or invention in course of such work, the employee becomes a trustee for the employer of that invention or discovery, and he is therefore as a trustee bound to give the benefit of any such discovery or invention to his employer. But the mere existence of the employer/employee relationship will not give the employer ownership of inventions made by the employee during the term of the relationship. And that is so even if the invention is germane to and useful for the employer's business, and even though the employee may have made use of the employer's time and resources in bringing the invention to completion. Certainly, all the circumstances must be considered in each case, but unless the contract of employment expressly so provides, or an invention is the product of work which the employee was paid to perform, it is unlikely that any invention made by the employee will be held to belong to the employer. 151 The fundamental idea said to inform when and why an employee's trusteeship of an invention arises is not hard to find and is deeply rooted in the general character of what in times past was described as the master-servant relationship. Viscount Simonds and Lord Reid both made this plain in Sterling Engineering Co Ltd v Patchett [1955] AC 534 (Sterling Engineering). Viscount Simonds stated (at 543): It is elementary that, where the employee in the course of his employment (i.e., in his employer's time and with his materials) makes an invention which it falls within his duty to make (as was the case here) he holds his interest in the invention and in any resulting patent as trustee for the employer. [Emphasis added] The implied term procuring this result his Lordship considered (at 544) was: … only an implied term in the same sense that it is an implied term, though not written at large, in the contract of service of any workman that what he produces by the strength of his arm or the skill of his hand or the exercise of his inventive faculty shall become the property of the employer. Likewise Lord Reid stated (at 547):

No doubt the respondent was the inventor and in the ordinary case the benefit of an invention belongs to the inventor. But at the time when he made these inventions he was employed by the appellants as their chief designer and it is, in my judgment, inherent in the legal relationship of master and servant that any product of the work which the servant is paid to do belongs to the master: I can find neither principle nor authority for holding that this rule ceased to apply if a product of that work happens to be a patentable invention. [Emphasis added] For a like view where the work product was a copyright article, see Report of the Committee to Consider the Law on Copyright and Design (1977), Cmnd 6732, (UK) para 571. Unless varied or excluded by the parties, the implied term was "the ordinary rule inherent in the parties' relationship of master and servant" (per Lord Reid at 548). 152 Unsurprisingly, express contractual stipulation apart, with the employer's entitlement turning on that which it was the employee's "duty" to do - and for which the employee was paid - the recurrent preoccupation in the case law has been in each instance with the actual subject matter and purpose of the employee's engagement itself and with the question: "[w]hat is it that he is employed to do?"; cf LIFFE Administration & Management v Pinkava [2007] 4 All ER 981 (LIFFE) at [97]. The end of this inquiry is to ascertain whether, if at all, it was part of an employee's engagement with his or her employer to utilise his or her "inventive faculty" (cf Sterling Engineering at 544; Vokes at 136) in an agreed way or for an agreed purpose for the benefit of, or to further the purposes of, the employer. To use the shorthand of Electrolux Ltd v Hudson [1977] FSR 312 at 326, was the employee "employed to make or discover inventions at all?", or, as French J put it, did the employee have "a duty to invent?" 153 If the employee's invention is the, or a, product of what he or she was employed to do, and did do, it will belong to the employer unless otherwise agreed: see eg British Reinforced Concrete Engineering Co Ltd v Lind (1917) 34 RPC 101 (British Reinforced Concrete); Adamson v Kenworthy (1932) 49 RPC 57; Triplex Safety Glass Co v Scorah [1938] 1 Ch 211 (Triplex Safety Glass); and see also Electrolux Ltd, at [97]. In such a case, it would be "inconsistent with [the employee's] duty to appropriate to himself an invention of this kind": Edisonia Ltd v Forse (1908) 25 RPC 546 at 552. 154 By way of contrast, if (a) the employee was not engaged to use his or her inventive capacity at all (cf Re Charles Selz Ltd's Patent Application (1954) 71 RPC 158); or (b) was so engaged only by way of additional duties to use his or her inventive capacity as and when asked (Spencer Industries Pty Ltd v Collins (2003) 58 IPR 425) or only for an agreed purpose, the employer would have in case (a) no claim on the employee's invention at all and in case (b) such a claim only if the invention resulted from a task the employee was asked to perform by way of additional duty or if the invention was related to the effectuation of the agreed purpose. 155 We note in passing that it can, on occasion, be factually difficult to define the subject matter over which a particular employee's inventive responsibility to the employer extends. This may be, for example, because (a) the employee's engagement gives him or her considerable discretion in determining the area of inventive inquiry he or she will pursue for the employer's benefit; or (b) the employee's managerial and inventive responsibilities combined are such that he or she, as a fiduciary, is obliged to give the employer the benefit of any invention developed in the course of his or her employment that is germane to the employer's business (see eg Fine Industrial Commodities Ltd v Powling (1954) 71 RPC 253; see also British Syphon Co Ltd v Homewood (No 2) [1956] All ER 897 which is probably better explained as a breach of fiduciary duty case); or (c) the employee's inventive responsibilities evolve over the course of the employment as a result, for example, of the employment tasks changing: see eg British Reinforced Concrete, at 109. 156 To illustrate the care that needs to be taken in determining what a person is employed to do, Jacob LJ in the LIFFE case helpfully indicated (at [97]) that this may not be revealed by looking at an employee's day-to-day work: Take for instance a research chemist working on a cancer cure for the last ten years. Suppose he came up with a cure for arthritis. He could not seriously contend that he owned the invention because he was day-to-day working on a cancer cure. His duty as a research chemist is clearly wider than his day-to-day work. 157 What needs to be said about the definitional problem which can exist in defining the subject matter encompassed by the implied term is that it differs little, if at all, from the parallel problem in fiduciary law of defining "the subject matter over which the fiduciary obligations extend" (Birtchnell v Equity Trustees, Executors & Agency Co Ltd (1929) 42 CLR 384 at 408) for the purposes of the conflict of duty and interest rule. 158 Finally, because the implied term turns critically on what the employee has been engaged to do, it does not seem to us to be decisive that the employer is publicly or privately owned.

(c) The employee's duty of confidentiality 159 We refer to this matter, not because the secrecy obligation of any UWA employee is in issue in this proceeding, but because it is a factor that informs our conclusions on the implied term aspect of the appeal. As with employee inventions, so also with confidentiality, the law is an unhappy mixture of equitable obligation (the duty of confidence and fiduciary obligation) and implied terms (particularly, but not only, the duty of good faith and fidelity): see Dean, [4.35] ff; Stafford and Ritchie, [4.3] ff, [5.207] ff. 160 All that is necessary for present purposes is that we refer briefly and in general terms to the protection afforded an employer against unauthorised disclosure during, or after, the currency of the employment relationship of confidential information communicated to, or acquired by, an employee in the course of his or her employment. The case law is voluminous: see generally, Dean; Stafford and Ritchie; and Toulson and Phipps, Confidentiality, (2nd ed, 2006). 161 Express contractual stipulation apart, an employee's duty of confidence to his or her employer can arise by way of implied contract or as a matter of equitable obligation. The scope of the duty will be the same in both cases despite their "different conceptual origins": Concut Pty Ltd v Worrell (2000) 176 ALR 693 at [26]. In employer-employee cases, however, the historical tendency has been to treat the matter as one of implied contract: see eg Ansell Rubber Co Pty Ltd v Allied Rubber Industries Pty Ltd [1967] VR 37 at 41; Dean, [2.85], [2.95]; but see Meagher, Gummow & Lehane's Equity Doctrines and Remedies, (4th ed, 2002) [41-020]. 162 As was indicated in Ansell Rubber, at 40, an obligation of confidence (whether contractual or equitable) may come into existence - … by reason of the nature of the relationship between persons, or by reason of the subject-matter and the circumstances in which the subject-matter has come into the hands of the person charged with the breach. It is clear that, in the employment setting, provided the information communicated to, or acquired by, an employee in the course of his or her employment has the necessary quality of confidentiality, ie it is relatively secret (Franchi v Franchi [1967] RPC 149 (Franchi), at 153); is not trivial (Coco v AN Clark (Engineers) Ltd [1969] RPC 41 (Coco) at 48); and is not public property or public knowledge (Saltman Engineering Co Ltd v Campbell Engineering Co Ltd (1948) 65 RPC 203 (Saltman Engineering Co) at 215), the courts will readily find that the employee is subject to a duty of confidence and that the unauthorised use or disclosure of the information by the employee will be an actionable wrong (see Gurry, Breach of Confidence (1984), Ch 8). 163 Importantly for present purposes, among the now well accepted factors pointing towards the confidentiality of a particular piece of information are the following: (i) When information has been produced or obtained only after the expenditure of time, or money, either by way of research or in the application of skill and ingenuity, its confidentiality is indicated (Saltman Engineering Co; Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales [1975] 2 NSWLR 104 at 117; H & R Block v Sanott [1976] 1 NZLR 213) as it is when another person could acquire or duplicate the same information only by going through the same process (Cranleigh Precision Engineering Ltd v Bryant [1966] RPC 81 at 88-89); and see generally Gurry, 70-71. (ii) The novelty or originality of the process, technique or product which the information encapsulates is an important indicator that the information itself is not already in the public domain, although novelty is not a pre-requisite: Saltman Engineering Co, at 216; Gurry, at 83. What is required in the cases of technical, scientific and business information is "some product of the human brain which is relatively secret": Cocoat 47. 164 An important aspect of the duty of confidence in employment settings is that the duty subsists after the termination of the employment so as to preclude disclosure or use of subsisting confidential information held by the ex-employee which was derived from his or her previous employment: see eg Triplex Safety Glass; United Sterling Corporation Ltd v Falton [1974] RPC 162; Ricketson & Cresswell, The Law of Intellectual Property: Copyright, Designs & Confidential Information (2nd ed 1999) [25.170]; and see generally, Dean [4.145]-[4.250]. While an ex-employee is entitled to make full use of the general knowledge, skill and experience - the "know-how" - which as a result of the previous employment has become his or her own (E Worsley & Co Ltd v Cooper [1939] 1 All ER 290 at 309-310), what the employee cannot do is to use or disclose confidential information that can fairly be regarded as a separate part of the employee's stock of knowledge which a man of ordinary honesty and intelligence would recognise to be the property of his old employer, and not his own to do as he likes with: Printers & Finishers Ltd v Holloway (No 2) [1965] RPC 239 at 255. A considerable body of case law has now evolved to aid in the process of differentiating the protectable from the non-protectable: see eg Faccenda Chicken Ltd v Fowler [1987] Ch 117; Dean [4.145] ff; Toulson and Phipps, 14-006 - 14-024. What is important to note for present purposes is that the duty of confidence can pose a significant obstacle to the mobility of employees engaged in research-related employment having applications in science or technology. 165 We emphasise the above for the following reason. Where an employee is engaged in an inventive capacity for the benefit of his or her employer, that employment will commonly result both in the disclosure to the employee of confidential information and the generation of such information by the employee. In respect of such information, the employee would ordinarily be precluded from disclosing it either to other employees or to third parties without the employer's consent, express or implied. In saying this we acknowledge that internal disclosures may, and often will, be a necessary part of the employment, as where the employee's research is being undertaken as part of a team effort and disclosure to other members of the team is impliedly authorised. 166 The importance of the duty of confidence for present purposes is that it buttresses and supplements the patent system by providing "trade secret" protection (i) before a patent has been applied for, and (ii) in relation to ideas and concepts which for some reason cannot be patented: Cornish, "Rights in University Innovations", (1992) 14(1), EIPR, 13. 167 Finally, an employer that is owed a duty of confidence by its employees may by its own act strip information otherwise subject to that duty of its quality of confidentiality by making it public as, for example, by publishing a patent specification revealing it: O. Mustad & Son v Dosen [1963] RPC 41; Franchi.

Trial Judge's conclusions on the application of implied term to universities 168 Early in his reasons French J accepted that each case involving a university and its academic staff must be assessed by reference to its particular circumstances. Nonetheless, he indicated that the university/academic staff relationship raised such distinctive considerations as to make it inappropriate to accept as a general proposition that there is a presumption at law that the university will be entitled to the rights to inventions developed by academic staff in the course of their research: [163]. Much later in his reasons his Honour enlarged upon this by reference to the particular circumstances of Dr Gray's employment: [1357]-[1367]. 169 Reflecting in part concerns raised by Monotti and Ricketson in their 2003 book, Universities and Intellectual Property, his Honour identified aspects of the university/academic staff relationship which highlighted why it might differ from the type of employment relationship that attracted the employee invention implied term. At [159]-[161] his Honour observed: 159 Monotti and Ricketson confessed to a "lingering discomfort with equating an academic's general duty to research with a duty to invent, even though the research is that from which an invention might reasonably be expected to result". In asking why this discomfort should exist they referred to the general obligation of secrecy imposed on the employee who has a duty to invent. Although contracts of employment may include express conditions to that effect, with safeguards on the duration of secrecy, an automatic implied obligation sits uncomfortably with the notion of "academic freedom", shared ownership and free exchange of research results (at [6.66]). There is much force in their observation at [6.67] that: … in the absence of an express or implied duty to invent and to hold any information secret, the principles that operate in industrial settings seem to have no application to the creation of inventions in the performance of normal academic duties of teaching, research and administration. 160 The authors acknowledged that their view was "essentially speculative" and based upon the essential differences between universities and other organisations. In my opinion, however, those differences in relation to persons engaged to undertake research at universities are of critical importance. 161 A person engaged to carry out research only is in a different category even when the possibility or probability exists that the research will lead to the development of an invention. Such a person has a duty to research, but no duty to invent. Where, as is often the case, the pathways that may be taken in research are a matter of choice, the question whether or not to invent will be a matter of choice. Given the nature of universities and the public purposes served by such as UWA, there is no basis for implying into the contracts of employment of its academic staff a duty not to disclose the results of research even if such disclosure could destroy the patentability of an invention. Absent such a duty and given a choice to invent or not invent, it is difficult to see upon what basis there can be a presumption that a term will be implied as a matter of law that the university has an entitlement to take the inventor's property rights in relation to the invention. In the present case UWA does not assert any limited right to the inventions but all the rights … The existence of such an implied term is even more problematical in circumstances such as the present where the researcher was expected to secure funding to a substantial degree from sources external to UWA. [Emphasis added] 170 When the primary Judge later considered the circumstances of Dr Gray's employment with UWA, he referred to the terms of his contract of employment (to which we earlier referred) and noted (at [1360]): Dr Gray had no duty to invent anything. He had a duty to undertake research and to stimulate research amongst staff and students at UWA. He was working for a university. His Honour went on to observe that, at all presently relevant times there was nothing to prevent Dr Gray from publishing the observations and discoveries he made and details of the technologies he developed. Nor was he obliged to protect by non-disclosure the patentability of any invention he developed in the course of his employment (at [1360]): In this important respect his employment obligations differed from those of a person employed by a private commercial entity whose inventions in the course of employment could benefit or affect the business of the employer: 171 The primary Judge went on to acknowledge that the "contemporary reality" was that most if not all universities (including UWA) engage in commercial activities. Nonetheless, when selecting the research work he would undertake, "Dr Gray was not required to advance a UWA commercial purpose": [1362]. 172 Of Dr Gray's research, his Honour said (at [1363]): Research of the kind that Dr Gray was engaged to do carried with it the possibility that he would develop inventions capable of attracting patent protection. The duty to undertake research could be discharged in a variety of ways. These were within the discretion of the researcher. One of the ways in which the duty could be discharged was the development and testing of new technologies. It could be said therefore that an invention made in the course of Dr Gray's research activities as an employee of UWA was an invention made within the scope of his employment and doing what he was employed to do. It does not follow that there was an implied term that the rights to which his invention gave rise belonged to UWA. As we will note below, UWA places considerable reliance upon this paragraph save for the last sentence. 173 Turning to whether the employee invention implication should be made into Dr Gray's employment contract, French J observed (at [1365]-[1366]): … There is an apparent threshold question whether the legal principles developed at common law apply to all contracts of employment regardless of the nature of the employer's business or activity and, in particular, whether or not they apply to a contract of employment with a university. The question is only apparently a threshold one. It really reduces to a consideration of the nature of the particular contract by reference to the business or activity of its employer and the scope of the employee's employment in relation to that business or activity. To that extent the onus is upon the proponent of the term to show that the contract is of a kind to which the legal implication applies. While each case falls to be decided according to its own circumstances, the approach foreshadowed in the earlier discussion is applicable to Dr Gray's case. The circumstances of his employment lie against the implication necessary to establish UWA's property rights. They were: 1. The absence of any duty to invent anything. 2. The freedom to publish the results of his research and any invention developed during that research notwithstanding that such publication might destroy the patentability of the invention. 3. The extent to which Dr Gray, as a researcher and those working with him, were expected to and did solicit funds for their research, including the development of inventions, from sources outside UWA. The relevance of those considerations is not affected by the arrangements under which UWA would administer funding, eg in the case of CSIRO or NH & MRC grants. 4. The necessity, consistent with research of the kind he was doing, to enter into collaborative arrangements with external organisations such as CSIRO. The history of the research undertaken by Dr Gray and his colleagues discloses that the role of the researcher at UWA in the area in which Dr Gray and his colleagues were working required him and them to act to a significant degree as entrepreneurs in securing the resources which would enable them to carry out their work. The circumstances of his employment were a long way removed from the situations which gave rise to the common law implications discussed in the English cases. The Victoria Universitycase arose in a different factual context which gave rise to a breach of fiduciary obligations. It did not require consideration of a factual situation and research of the character involved in the present case.

Grounds of appeal 1-5 and 8 174 In these grounds UWA challenged almost every aspect of his Honour's reasoning that has been outlined above. The fundamental complaint is that French J erred in not finding the implied term (Ground 1). Two of the remaining grounds focus on alleged errors in his Honour's (i) findings of difference between UWA as an employer and other employers (for which it is said there was no evidence); and (ii) reliance upon the four differentiating factors (at [1366] set out at [173] above), and upon UWA being a university, to negative the implication (Grounds 2 and 3). The remaining two grounds (4) and (5) contend that even if UWA was in a different or special category of employer, the implication should nonetheless have been made in "the specific situation of Dr Gray's employment" as well as because of his Honour's finding concerning the possibility that his research would develop inventions ([1363] noted at [172] above). 175 Given the view we take in this matter, it is unnecessary for us to consider and express a view upon the question whether Ground 4 (which refers to the "specific situation" of Dr Gray's employment at UWA) is in reality no more than an impermissible attempt to have an implication in fact masquerade as an implication in law. 176 We need again to emphasise the distinctive manner in which this matter ultimately has been prosecuted both before French J and on the appeal. 177 First, the case does not, as pleaded or otherwise, raise any question of whether a term governing ownership of inventions made in the course of Dr Gray's employment with UWA should be implied in fact into his employment contract. We are concerned only with an implication in law. 178 Secondly, the case is not about an employee engaged under a special contract with UWA to produce an invention or to do research directed to producing an invention. Such a contract may well warrant the implication in law of a term that the rights in relation to the invention produced would belong to UWA: see [163]. 179 Thirdly, at the trial and on the appeal, UWA has dealt with the question of the implied term as if this was isolated from other bodies of law, which either supplement and buttress the implied term (this is particularly so of the law of confidence) or which march in tandem with it, for example, the ownership of the copyright product of academic staff. As French J's reasons show, his Honour was acutely aware of the importance that a duty of secrecy would have if the implication was made. On the appeal this matter was again emphasised as it bore not only on the ability to publish research product freely but also on such issues as collaboration and information exchanges with persons outside UWA and academic staff mobility. UWA has not confronted this issue directly, perhaps for understandable reasons, although we note in passing that the IP Regulations deal expressly, albeit incompletely, with confidential information: IP Regulations, regs 1 and 4(1). 180 Relatedly, if, as we accept, the principle informing the implied term is that identified in Sterling Engineering - ie an employer is entitled to any product of the work which the employee is paid to do - the issue of ownership of other forms of intellectual property produced by the academic staff of a university (and of copyright in particular) marches hand-in-hand with the present: on copyright, see eg Copyright Act 1968 (Cth) s 35(6); and Stephenson Jordan & Harrison Ltd v MacDonald & Evans (1951) 69 RPC 10 at 18, where it is said: "It is inconceivable that because Professor Maitland was in the service at the time of the University of Cambridge … anybody but himself, one would have thought, could have claimed the copyright in [his] lectures." Apart from noting the possibility of such wider implications for intellectual property rights flowing from the view pressed by UWA, we do not further examine the matter of ownership of other species of intellectual property. 181 Although UWA changed its stance on the implied term during the hearing before us, it finally accepted (Transcript 159) that it was required to establish that Dr Gray's employment contract was one of the class or type in which the employee invention term would be implied. To that end, and to put the matter shortly, UWA contended, first, that there was no relevant distinction between a university as an employer and any other employer; and, secondly, that Dr Gray's contractual duty to undertake research was, in the circumstances, sufficient to bring it within the class of contract attracting the implied term. 182 We disagree with both contentions. The first disregards the distinctiveness of universities (such as UWA); the second disregards both the distinctiveness of academic "employment" in universities (such as UWA) and the terms and research circumstances of Dr Gray's own employment. As French J properly recognised, both of these matters had to be considered in determining whether Dr Gray's contract of employment stood within or apart from the class or type of contract that attracted the implied term at law. There was in this sense a "threshold question": [1365]. 183 First, there is the distinctiveness of UWA as a university. As we earlier indicated, UWA is a special purpose statutory corporation. It was created to serve the public purposes served by a "university" (as the language of its Act makes plain: see the preamble to the Act and s 2). As such, UWA is, at least, an institution of higher education offering courses and providing research facilities in various disciplines and having amongst its acknowledged powers and privileges that of conferring degrees: cf Shorter Oxford English Dictionary, vol 2 "university" (5th ed, 2002); UWA Act, s 29. 184 We accept that UWA has not been immune from the forces, financial and otherwise, that are forcing changes in the character of the university sector in Australia. As French J noted, UWA has engaged in commercial activities, as have done "most, if not all, universities". The evidence put on by UWA as to the range, character and significance of such activities of UWA was slight, though it hoped on the appeal that we would take judicial notice of these matters: cf Evidence Act, s 144(1) (Cth). What is notable for present purposes is that there is nothing in the evidence to suggest that those commercial activities have displaced, either totally or if in part to what extent, UWA's traditional public function as an institution of higher education in favour of the pursuit of commercial purposes (if it lawfully could do so under its Act). Its function, in other words, was not limited to that of engaging academic staff for its own commercial purposes. Accordingly, we agree with French J that on the evidence Dr Gray was not required to advance a commercial purpose of UWA when selecting the research he would undertake. 185 A further distinctive feature of many, but not all, universities (including UWA) is that their academic staff are part of the membership that constitutes the corporation and as such are bound by the statutes, regulations, etc of the university. Their membership is integral to their status and place in the university. To define the relationship of an academic staff member with a university simply in terms of a contract of employment is to ignore a distinctive dimension of that relationship. 186 Secondly, there is the distinctiveness of academic employment in a university. The two faceted character of an academic staff member's relationship with a university - ie as member and as employee - is "not without significance" as French J observed ([1361]). It probably is the case - though it is not a matter we need explore - that some of the practices revealed in the evidence in this matter (not repudiated by UWA), and the underlying values which seem to inform them, are more likely to be referable to understandings that have been traditionally associated with membership. The seeming freedom to choose the subject or line of research and the manner of its pursuit and the freedom to decide when and how to publish the products of one's research to the extent that these subsist, sit uneasily with employment notions such as the implied duty of an employee to obey all lawful and reasonable instructions of the employer within the scope of the employee's employment, or to maintain the secrecy of confidential information generated in the course of employment. Yet they are apparent manifestations of the contested value of "academic freedom": Cornish, "Rights in University Innovations", at 2-3. 187 We refer to the above "freedoms", not for the purposes of venturing views upon, let alone making findings about, their existence, nature and extent in modern Australian universities. We can safely assume that these are, and will remain, contested matters. Rather we do so for two purposes. First, UWA has been critical of the apparent "influence" of the writings of Monotti and Ricketson on French J and in particular of their views on both implied terms and "academic freedom" and "the essential differences between universities and other organisations". As his Honour observed (at [159]): … those differences in relation to persons engaged to undertake research at universities are of critical importance. We have already indicated that considerations of policy and consequentialist considerations are matters properly to be taken into account in deciding whether or not a term should be implied in law into a class or type of contract. As we will indicate below, we consider that it was proper for his Honour to take account of the considerations raised by Monotti and Ricketson in the manner he did in rejecting the implication sought. 188 The second reason we refer to the "freedoms" is that there was evidence of practices by Dr Gray and his research teams in relation to self-determined research, publication of research results and inter-institutional collaboration which were consistent in some degree with what probably is comprehended by academic freedom as a value, but which were inconsistent with the Sterling Engineering principle of employer entitlement that informs the employment obligation as to inventions propounded by UWA. What is to be noted here is that they are matters of which French J could, and properly did, take account. 189 We refer further to these matters below when considering those aspects of Dr Gray's employment and of the research environment in which he conducted his research, on which French J relied to negative the implication. Before dealing with them, we should comment briefly upon the implied term proposed, the terms of which were noted at [85] above. Given our view on the implication, it is unnecessary to consider such terminological difficulties with it as: what is signified by an "invention"?; will a significant trade secret suffice?; why should "authorisation" to solve problems etc suffice given the language of instruction and duty in the case law? 190 The matter of importance is the place such a term would have had in Dr Gray's contract and the employment context it would presuppose. We have already foreshadowed the quite significant collateral impact it would have had on the practices of academics such as Dr Gray and his team (as these have been revealed in the evidence) if the implied duty was underpinned by a duty not to make an unauthorised use or disclosure of confidential information generated in the course of the conduct of the research. Such is the case with private sector commercial entities. It would have prohibited publications (not authorised by UWA) containing information that was "relatively secret"; would have impaired academic collaborations and exchanges because of the potential for participating in breaches of confidence; and would have restricted academic staff mobility. Perhaps expediently, UWA has not contended that such a duty would have accompanied such a term as of course (cf Triplex Safety Glass (patent applied for after termination of employment), yet it would seem to be an inevitable consequence of the Sterling Engineering principle to which we have referred. 191 If, however, one were to assume that the implied term was free-standing, unsupported by a duty of confidence, the rationale of it would have been strange indeed. It would not be that the employer was entitled to all of the product of what the employee was employed and paid to do. Rather it would be that the employer was entitled only to "inventions" falling within the scope of the employment. The employee would have been free to destroy the potential patentability of an invention by progressively putting research results into the public domain. 192 Understandably, this is a consideration that French J emphasised, most notably at [1360] where his Honour contrasted Dr Gray's freedom to publish with the obligation of an employee in a private commercial entity, whose inventions made in the course of employment could benefit or affect the business of the employer. UWA's response, at least, to the publication of research results, is curious and unconvincing. It accepts the fact that universities and university researchers publish the results of their research, but it says that that fact cannot be relevant to whether or not a term as to patentable inventions is to be implied into Dr Gray's contract. It dismisses the problem of prior publication as one of timing and of self-imposed restraint until a provisional patent has been filed. Perhaps anticipating the obvious difficulties with this response, UWA sought to resurrect, but it later abandoned, the duty of good faith and fidelity as the vehicle to restrain publication that would destroy patentability. 193 This leads us to consider the circumstances of Dr Gray's employment and of the research environment in which he worked, upon which French J relied to negative the implication that UWA sought. 194 First, his Honour found that under his contract of employment Dr Gray had no duty to invent anything, though he had a duty to research and to stimulate research: "He was working for a university" (at [1360]). To put the matter as we earlier put it, he had not been engaged to use his inventive faculty in an agreed way or for an agreed purpose, for UWA's benefit. While his duty to research was in an applied science, it cannot for that reason be transformed into a duty to invent, notwithstanding that his actual research, in fact, carried the possibility of developing inventions capable of attracting patent protection. 195 We reject UWA's contention to the contrary and we agree with the primary Judge's reasons and conclusions. The insuperable difficulty in UWA's submissions is that Dr Gray's employment duties did not even require him to perform tasks from which inventions might result. The subject matter and the manner of discharge of his duty to research were in his discretion. He was not employed to invent. UWA put on extensive written submissions criticising French J's use of the formula "duty to invent". The shorthand expression is widely used in scholarly writing: see Dean, 238 ff; Monotti and Ricketson, 6.56-6.67. As so used, and as used by French J, its meaning is self-evident and unobjectionable. 196 UWA has sought to circumvent his Honour's conclusion in the following way. Though Dr Gray was entitled to determine the subject and manner of his research, if what he chose to do required him to bring his inventive faculty to bear, then the doing of that research should, it is said, be regarded as that which he was engaged to do and for which he was paid. Any invention resulting from his so doing should, in consequence, attract the implied term. 197 Such a deemed, contingent duty to invent requires an untenable implication. It is not what Dr Gray's terms of employment required; there is no "necessity" for it being implied by law into the employment contracts of university academic staff; and, importantly, it is inconsistent with the researcher's freedom to share and to publish research results. 198 Secondly, French J regarded the freedom to publish the results of research, including invention, notwithstanding that the publication might destroy patentability, as another circumstance telling against the implication. From what we have already said about the constraining character of the duty of confidence and of its underpinning of the implied term relating to employee inventions, the importance of this particular "freedom" is self-evident. We earlier referred both to Dr Burton's evidence, accepted by his Honour, on the Gray group's "strong commitment to the publication and dissemination of research results", and of Professor Barber's evidence of the "kudos and reputation" that UWA desired "from academic publication in the peer-reviewed literature". While we do not suggest that Dr Gray and his researchers may not have controlled the time and manner of their publications, the evidence clearly suggests that Dr Gray enjoyed the freedom to publish that French J found. He was not constrained by a secrecy obligation. 199 As noted earlier in its submissions, UWA appears to have accepted that this was the case. In its oral submissions, it contended, seemingly for the first time, that a prohibition on publication arose only if and when "an invention" had been developed and then only by virtue of reg 7 of the Patents Regulations. We have already indicated that those regulations were devoid of significance for the purposes of UWA's contract claim. In any event, reg 7 was not itself a free standing prohibition. It was a proscription that arose once a particular point in a regulatory régime was reached. In the circumstances of this matter that point was not, and could not have been, reached, because UWA had abandoned the Patents Regulations régime in favour of an "alternative pathway": see "The Patents Regulations" above. 200 Thirdly, French J considered that the extent to which Dr Gray and those working with him were expected to and did solicit funds for their research was another circumstance militating against the implication. We accept as a starting point that the solicitation of funds from public or private sources for the purposes of conducting research is not a phenomenon unique to universities. It is commonplace in the private sector: cf Industry Research and Development Act 1986 (Cth). What was "a striking feature of this case" ([161]) was the amount of time and effort devoted by Dr Gray and his researchers in applying for research grants, and the extent of their dependence on their success. UWA may have wished to foster, but seemingly could not fund, Dr Gray's research. To the extent that the Sterling Engineering principle has nascent in it the idea that the employer pays the researcher and, in significant degree, for the research itself, it can be said, without criticism of UWA that, if sustained, the suggested implied term would allow UWA to reap where various entities had sown. Importantly, it is implicit in what French J said that Dr Gray was raising the funds for his research, the metes and bounds of which he determined, though UWA received and managed the funds. Further, it also can probably be inferred that the grants were made to Dr Gray as an established researcher and not to UWA as such, although its involvement as institutional manager of the grant would also be taken into account by the funding body. So considered, the "grant factor" can properly be said to be a consideration that further weakens UWA's claim to the benefits of any inventions so generated. 201 UWA seeks to counter this argument by saying that Dr Gray's post-contractual conduct cannot be used to negate an implication into a contract. 202 After referring to this factor and to the necessity, consistent with the kind of work Dr Gray was doing, to enter into collaborative arrangements, French J went on to use Dr Gray's experience to characterise "the role of the researcher at UWA" in the area in which Dr Gray was working. His Honour described that as being "required … to act as entrepreneurs in securing the resources which would enable them to carry out their work": [1366]. It was immediately following this that his Honour made the following important observation: The circumstances of his employment were a long way removed from the situations which gave rise to the common law implications discussed in the English cases. In these circumstances we consider that the proper complexion to place upon what his Honour said is that he was describing the known context and shared expectations of the parties in relation to raising funds for research at the time of contracting, using what happened post-contract as the manifestation of what was anticipated. We would add that we were not taken to any evidence which suggested what contractual arrangements, if any, there were as to the raising of funds for research by UWA or by Dr Gray. If there was no such arrangement, we see nothing impermissible in French J having regard to Dr Gray's subsequent behaviour in fund raising to negative the suggested implication. 203 The fourth and final negativing circumstance adverted to by the primary Judge was the necessity, consistent with research of the kind he was doing, for Dr Gray to enter into collaborative arrangements with external organisations. The evidence was replete with instances of such collaborations and of information exchanges between Dr Gray and his researchers on the one hand and between them and researchers in other institutions on the other. Informative examples of both processes at work can be seen in the evolution of the research on the binding of Yttrium90 to microspheres (see [277]-[300]) and the use made in it of notes of Dr Self of St Vincent's Hospital written in 1984: see also [1469]. 204 Implicit in his Honour's reliance upon the collaborations is the appreciation that the need for inter-institutional cooperation in the research being conducted tells against the exclusive appropriation of its product to one institution (ie UWA) via an implied term in the event that an invention is made. Further, and we consider importantly, the evidence on collaboration and information exchanges in Dr Gray's field of research suggests that some level of sharing of research results and know-how was a necessary and accepted practice in the particular research community so as to increase "the stock of available knowledge": cf Taylor v Taylor (1910) 10 CLR 218 (Taylor) at 224. 205 As we earlier noted, the principles governing terms implied by law themselves raise a threshold question which French J correctly identified. The onus is on the proponent of the term to show that the contract is of a class, type or kind to which the legal implication applies: [1365]. Save in cases of first impression, the discharge of that onus will pose few problems. Thereafter the question becomes one as to whether the terms agreed by the parties to the contract are inconsistent with, or negate, the implied term. The opponent of the implication bears this onus. The present case is of the former variety.

Conclusion 206 His Honour's conclusion that UWA failed at the threshold is correct and for a variety of reasons. Justice French was well aware that the circumstances of Dr Gray's employment were a long way removed from the situations that gave rise to the common law implication of employer ownership of employee inventions that were developed in the course of, and as a product of, what the employee was employed actually to do. Dr Gray's employer was a university; he was a member and an employee of it. In determining whether such an employment was nonetheless one which attracted the common law implication, French J was obliged to have regard to what Viscount Simonds in Sterling Engineering described as "more general considerations" and he did have regard to them. As we have indicated, these include both considerations of policy and consequentialist considerations. Importantly, regard can be had to considerations of these kinds, not only in support of making the implication into a class, but also to negative the implication. In this matter, and again rightly in our view, his Honour relied upon them to negative the implication. His Honour also relied, as we have indicated, upon four specific and differentiating aspects of Dr Gray's employment and research environment. One of these alone - that Dr Gray had no duty to invent - could well of itself have justified the dismissal of UWA's claim. What we wish to highlight, because it was a central pillar in his Honour's reasons and is in our own, is the distinctiveness of a university such as UWA and of academic employment in it as considerations relevant to the determination of the "threshold question". 207 The employee invention implied term is a particularly blunt instrument to settle the ownership of employee inventions. UWA recognised as much in the provision it made in the Patents Regulations, and then the IP Regulations, in relation to the apportionment of the benefits derived from patents and other intellectual property, as between UWA and the inventor/originator. Equally importantly, as we have indicated, in employment contracts to which it applies, the implied term presupposes the common law duty of fidelity and the equitable duty of confidence to protect for the employer's benefit confidential (and other) information generated during the course of the employment, which is not, or is not yet, patentable. As this case highlights, it is important to appreciate what the implication itself presupposes about how the employment relationship is already regulated when considering the threshold question. It is this which explains and justifies French J's concern with Dr Gray's employment circumstances and his conclusions that Dr Gray's freedom to publish research results and the need to collaborate with external institutions told against the implication. 208 His Honour obviously considered freedom to publish as an important value in the setting of a university given its nature and public purposes. And we would note in passing that, in other contexts involving education (eg charitable trusts for the advancement of education), the law has placed a particular value upon the dissemination of the results of research: see Taylorper Griffith CJ at 231. Justice French obviously attributed a like significance to the academic researcher's freedom to choose the subject and manner of research without being subject to a duty to invent. As is quite clear from [160] of his Honour's reasons, these two features plus the fact that the contract of employment was with a university serving public purposes, were significant characteristics of the general class or type of contract that was under consideration for the purposes of the threshold question. Dr Gray's contract, as his Honour later found, had those characteristics: see [1359]-[1363]. 209 In appraising that contract, the primary Judge necessarily had regard both to the nature and public purposes of universities and to the distinctiveness of academic employment in universities, focusing in particular on the two "freedoms". None of these matters, though, were ones upon which significant evidence was adduced. This explains why his Honour's focus was on such material as there was relating to UWA in its statutory setting and to the terms and circumstances of Dr Gray's employment. Nonetheless, it was not only proper but also necessary for his Honour to have regard to the more general issues of policy suggested by that material (especially as they related to the two freedoms) which would arise if the implication was, or was not, to be made. In that regard his reference to the work of Monotti and Ricketson and to "academic freedom" was entirely appropriate. After all, what was being made was a judgment as to the "necessity" of implying a term into a particular class or type of contract. There was ample reason for not making the implication sought given the class or type of contract in question. 210 Like the primary Judge, in reaching this conclusion we have found it unnecessary to consider the judgment of Nettle J in the Victoria University of Technology case. That was a clear case of misappropriation of a corporate opportunity in breach of fiduciary duty. While Nettle J considered, as we have noted, the applicability of the implied term relating to employee inventions and rejected it in respect of academic staff members, he was not called upon to consider, and did not consider, the question whether universities were different as a category of employer. For that reason we have derived little assistance from that case. 211 We would also add that, while our conclusion recognises a distinction between the ownership of employee inventions in universities and in private sector business entities, we should not be taken as suggesting that the solution reached by use of the implied term in law is necessarily a desirable one in either case. What we do emphasise is that there are clear reasons for not implying such a term as to inventions in a case such as this. If a less crude and more fair and reasonable result is to be achieved which balances the respective interests of a university and its academic staff members, this will need to be done by or under legislation or, if it could be devised, by an express contractual régime appropriate to the circumstances of the individual case. 212 We would not sustain grounds 1 to 5 and 8 of the appeal.

B GROUNDs OF APPEAL 6 and 7: FIDUCIARY OBLIGATIONS 213 Little need be said of Ground 6, which complained of the primary Judge's failure to find breaches by Dr Gray of the Fiduciary Duties. The Fiduciary Duties were set out at [77] above. 214 The breach of fiduciary duty claims pleaded presupposed that in making patent applications and in causing such applications to be made, Dr Gray was dealing for his own benefit with rights in relation to the relevant inventions which UWA then owned or in which it then had an interest. Put shortly, these claims were premised upon the success of the claim in implied contract entitling UWA to the inventions. They were not pleaded as misappropriated "opportunities" claims as was the claim in Victoria University of Technology. On the hearing of the appeal, senior counsel for UWA conceded that this ground would fail if UWA could not establish that it had property or rights in the inventions, in the right to apply for the patents, or in antecedent trade secrets which comprised the respective inventions. It has failed to do so. 215 Ground 7 was to the effect that the findings referred to in Ground 6 were contrary to the evidence, or alternatively, to the weight of evidence. UWA did not address independent submissions to this ground and we need say no more of it. 216 We will dismiss the appeal in so far as it rests on Grounds 6 and 7.

C Ground of Appeal 9 217 As noted at [13] above, this ground was not pressed.

D Grounds of Appeal 10-12: invention and inventive concept 218 As the primary Judge noted at [1419], these and the subsequent grounds of appeal arise if, contrary to his Honour's view (and our own), there was an implied term in law in Dr Gray's contract conferring on UWA proprietary rights in relation to his inventions, or if the Prompt Notification Condition of the Patents Regulations applied.

General observations 219 As previously noted, before French J UWA's case was that Dr Gray, either by himself or with others, "developed and/or discovered certain inventions" which were patentable and commercially significant (at [1410]). As noted at [6] above, the inventions that remained relevant on the appeal were the two SIRT-Spheres Inventions (SIRT-1 and SIRT-2), the DOX-Spheres Invention and the Thermo-Spheres-1 Invention. UWA did not particularise what acts by what person or persons were said to have given rise to the development and/or discovery of the respective inventions (at [1411]). Further, according to UWA, it could prove its case by an assessment of the most specific of the claims in the specification associated with a relevant patent application. As his Honour noted, this approach was most beneficial to UWA because the most specific claims were likely to embody developments latest in time (at [1416]). 220 In respect of each invention, UWA's approach was to identify the problems that were solved, cross-referred to claims in the specification, on the basis that the invention was complete at the time when the solutions were developed (see, for each relevant invention, the summary of UWA's approach at [1456]-[1460], [1478], [1500]-[1501] and [1518]-[1522]). 221 His Honour rejected this approach as a matter of principle. After a detailed analysis of the authorities (at [1419]-[1441]), French J concluded that the relevant task was, first, to identify the "inventive concept" of each invention by reference to the terms of the relevant specification (which his Honour said would be for the most part the relevant PCT specification), and, second, to ascertain the timing of the invention and the identity of the inventor, by reference to that inventive concept (see [1418] and [1442]-[1443]). Importantly, his Honour distinguished between identification of inventive concept, timing of the invention and identification of inventor on the one hand and "the subsequent process of reduction to practice some elements of which may have found their way into the claims in the application" on the other hand (at [1433]). 222 One of the authorities that French J considered in reaching this conclusion was Polwood Pty Ltd v Foxworth Pty Ltd (2008) 165 FCR 527 (Polwood) (at [1434], [1438]-[1441]). Because UWA made much of [60] in Polwood in its submissions on the appeal,it is convenient that we set it out at once: The invention or inventive concept of a patent or patent application should be discerned from the specification, the whole of the specification including the claims. The body of the specification describes the invention and should explain the inventive concepts involved. While the claims may claim less than the whole of the invention, they represent the patentee's description of the invention sought to be protected and for which the monopoly is claimed. The claims assist in understanding the invention and the inventive concept or concepts that gave rise to it. There may be only one invention but it may be the subject of more than one inventive concept or inventive contribution. The invention may consist of a combination of elements. It may be that different persons contributed to that combination. [Emphasis added] 223 Contrary to UWA's submissions on the appeal, French J did not consider the claims to the exclusion of all other material. His Honour expressly noted (at [1442]) that the approach "properly eschews a claim by claim analysis and does not accept that selection of the narrowest claim discloses the invention". His Honour's view is supported by the statements in Polwood at [62]-[66]. While it might not be apparent from UWA's submissions in the appeal, it is clear from his Honour's reasons that this statement involves a rejection in principle of the approach that UWA advocated at trial, namely, not only a claim by claim analysis but also an even more limited focus on the narrowest claim as disclosing the invention. The inconsistency between [60] of Polwood and UWA's approach at trial is manifest. 224 First, UWA contended (both generally and for each invention) that French J considered but did not apply the approach required by Polwood because he had regard to the claims rather than the specification as a whole. But UWA's submissions on the hearing at first instance invited, indeed demanded, that consideration be given to the most specific claims because that approach was most beneficial to UWA on the basis of its case as then argued. As noted above, this was made clear from the reasons of the primary Judge at [1416]. For the reasons that follow, UWA's criticism of French J on this basis is unfounded as a matter of fact. It must also be recognised that UWA's case on appeal is fundamentally inconsistent with the case it made at trial in this respect. 225 Senior counsel for UWA fairly acknowledged that this was so in exchanges with the Bench on the hearing of the appeal, conceding that there had been an element of forcing the primary Judge into the "breaking down process" for which UWA criticised him on the appeal, and that UWA had been "complicit" in asking his Honour to do precisely what he had done. Senior counsel said I'm not addressing it on the basis that his Honour didn't do what the parties collectively asked him to do. But what I'm saying is I'm trying to identify the error for the appeal court so that the appeal court can look at it in a different light and particularly in the way that the respondent puts the submissions 226 Second, UWA's new case on appeal ultimately embraced the inventive concept approach advocated by Sirtex in the court below and accepted by his Honour. Yet in the appeal UWA contended that French J, if he had applied Polwood, ought to have found other inventive concepts for each invention, including in some cases (potentially) multiple inventive concepts or contributions for a single invention as in Polwood itself. The judgment in Polwood was published after the trial but before his Honour delivered judgment. The parties apparently provided a copy of the Full Court's reasons for judgment in Polwood to his Honour. UWA did not, however, seek to be heard on the implications of the decision, and the putative other inventive concepts now relied upon by UWA in the appeal were never put to the primary Judge. 227 In sum, UWA's submissions on appeal with respect to these grounds bear little resemblance to, and in many respects are inconsistent with, the case that it advanced at trial. 228 Dr Gray points out in his written submissions that UWA did not seek to make submissions on Polwood before the primary Judge, but does not seem to go so far as to contend that UWA's case on appeal is so inconsistent with its case at trial that it should be precluded from arguing it. Be this as it may, the acknowledged inconsistency between UWA's case at trial and on appeal is material to the question of the existence of any error by the primary Judge, as the observations of senior counsel for UWA (set out above at [225]) seem to accept. 229 Third, many of UWA's submissions assert that French J should have found certain facts by reference to, among other things, the document entitled "Appellant's Summary Document on Factual Matters in the Appeal". Yet, as Dr Gray's submissions repeatedly note, many of the "facts" from this document on which UWA relies were and remain in dispute. 230 Fourth, UWA's submissions make assertions of facts that they suggest should have been found by his Honour without in any way addressing the facts found by him with which the proposed findings are inconsistent. The submissions simply disregard findings of fact made by his Honour that are inconvenient to UWA's recast case on appeal. In consequence, UWA's case on appeal purports to reduce the hearing before French J to "little more than a preliminary skirmish'": Coulton v Holcombe (1986) 162 CLR 1 at 7. Again, Dr Gray's submissions noted this tendency (eg at transcript p 219 where counsel for Dr Gray described the appeal as attacking every finding of fact and proposition of law found by the trial Judge and, in so doing, ignoring "enormous chunks of the judgment and the reasoning") but did not go so far as to submit that the arguments on appeal were denied to UWA by its conduct of its case at trial. 231 Nevertheless, it is apparent that UWA's approach is inconsistent with its obligation to demonstrate some error by his Honour as to a legal, factual or discretionary matter. Mere assertion of error and a submission that different facts should have been found do not, without more, discharge this obligation. 232 Fifth, and as already noted, many of the grounds of appeal are repetitive and formulaic. Presumably for this reason UWA made submissions about the patents issues with respect to groups of appeal grounds rather than individual grounds. We adopt the same approach. 233 Against the background recounted above, UWA's repeated submission that its case on appeal with respect to the patents issues is "straightforward and compelling in favour of [UWA]" is unhelpful.

UWA's submissions on Grounds 10-12 234 By Grounds 10-12, UWA asserts that French J erred in three respects involving legal principle. The notice of appeal identified these alleged errors as follows: · first, applying authorities of the United States of America and Canada (Burroughs Wellcome Co v Barr Laboratories Inc 40 F 3d 1223 (Fed Cir. 1994) (Burroughs Wellcome) and Apotex Inc v Wellcome Foundation Ltd [2002] 4 SCR 153 (Apotex)) despite differences in the factual circumstances (Ground 10); · second, finding that "verification or reduction to practice" as described in those authorities was outside the scope of the inventions (Ground 11); and · third, failing to apply the reasoning in Polwood (Ground 12). 235 UWA's submissions disclose that these grounds are related both to each other and to UWA's submissions on other grounds of appeal, in particular, grounds concerning his Honour's factual findings about the respective inventions. 236 Adopting the same structure, we deal with the submissions concerning appeal Grounds 10 to 12 together, and separately from those other grounds. 237 According to UWA, contrary to the reasoning in Polwood (at [60]), French J did not discern the invention or inventive concept from the whole of the specification including the body of the specification and did not refer to the different purposes of the latter on the one hand and the claims (which may be for less than the whole of the invention) on the other. Instead, UWA submitted, his Honour focussed upon selected claims. This, submitted UWA, emerged clearly from French J's brief review of the specification of the alleged priority document before his descent into "a detailed review of the competing submissions of the parties, dominated by the claim-focussed approach advocated by Sirtex". 238 Further, UWA noted that the trial Judge dealt with the Deed of Assignment dated 1 May 1997 "only obliquely" (at [1042]-[1045]) and not "in accordance with the principles [in Polwood]as relevant to [UWA's] claims against Dr Gray". Thereafter, according to UWA, none of the inventions in the patent applications and patent specifications or know-how covered by the Deed of Assignment were addressed by the primary Judge by reference to the assignment or in accordance with the principles recognised in Polwood. In so far as UWA's submission deals with the assignment its meaning is elusive. It is made without elaboration in para 12 of UWA's reply submissions. 239 The suggested inconsistencies with the reasoning in Polwood were said to flow from Sirtex's incorrect approach to "inventive concept" (at [1418]) which his Honour adopted (at [1442]). 240 UWA submitted that the primary Judge (at [1443]) erred in the way in which he contrasted inventive concept (indeed, inventions more generally) with mere verification and reduction to practice. According to UWA, conception of an invention is complete when one of ordinary skill in the art can perform the invention without unduly extensive research and experimentation. (citing Polwood and Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) (2007) 235 CLR 173 (Lockwood) at [59]-[60]). However, Burroughs Wellcome and Apotex, to which French J referred (at [1426]-[1427] and [1440]), are consistent with the same proposition, namely: an invention will be complete once the inventor has arrived at the final, definitive idea or concept. As UWA submitted on the appeal and his Honour appreciated (at [1426]), this requirement is satisfied when one of ordinary skill in the art can practise or perform the invention, that is to say, reduce it to practice, without extensive experimentation or research. 241 UWA said that it accepted the correctness of Burroughs Wellcome and Apotex as good authority for the drawing of the distinction between mere speculation, factually based invention, and verification or reduction to practice. According to UWA, however, French J misapplied these authorities to the facts. In essence, UWA claimed that before Dr Gray joined it in 1985 he had no more than a concept insufficient to constitute an invention; that his concepts at that time required considerable testing and/or experimentation in order to become "inventions"; and that that required testing and/or experimentation all occurred after Dr Gray joined UWA.

Dr Gray's submissions on Grounds 10-12 242 Dr Gray contended that UWA's suggested test of invention (namely, that the inventive concept is complete when one of ordinary skill in the art could perform the invention without unduly extensive experimentation or research) was flawed. This formulation, said Dr Gray, misconceives the reasoning in Polwood and invalidly attempts to incorporate the process of verification as part of the inventive concept. According to Dr Gray, French J correctly identified the principles to be derived from Burroughs Wellcome, Apotex and Polwood. 243 Dr Gray submitted that UWA's grounds of appeal and submissions were inconsistent. Hence, UWA asserted that French J erred in relying on the overseas authorities, Burroughs Wellcome and Apotex, as applicable notwithstanding the different factual circumstances in the present proceeding(Ground 10), yet made no submissions to that effect, instead, acknowledging that those decisions are in accordance with Australian law. This, said Dr Gray, required Ground 10 to be rejected. 244 As to Ground 11, described above in [234] (erroneously finding that verification or reduction to practice as described in Burroughs Wellcome and Apotex lay outside the scope of the invention and/or inventive concept), UWA's complaint is one of application rather than identification of applicable principle. Burroughs Wellcome and Apotex confirm the distinction between inventive concept and invention on the one hand and verification or reduction to practice on the other. UWA acknowledges that distinction in one part of its principal submissions (at para 105), yet contends in Ground 11 that the processes of verification and reduction to practice were within "the scope of the invention and/or inventive concept in the different factual circumstances for the inventions the subject of the proceeding". These inconsistent positions are not maintainable. 245 As to Ground 12 (failure properly to apply Polwood), Dr Gray submitted that UWA's complaints about French J's alleged failure to consider the specification as a whole (contrary to Polwood) cannot stand against a fair reading of the primary judgment. 246 In Polwood, the apparatus that was described in the patent applications and that reduced the Polwoodconcept to practice, was itself the result of inventive skill on the part of Foxworth. That apparatus utilised the inventive concept communicated to Foxworth by the Polwood parties. Each of Foxworth and Polwood asserted inventorship of the apparatus as claimed. The primary Judge had found joint inventorship. The claims were of two broad types: the first being the method and process, and the second being an apparatus for implementing the method and process. The primary Judge had found that Foxworth did not merely provide its skill to implement Polwood's concept or simply put that concept into effect. As the Full Court noted at [20], his Honour effectively found that there were "two hearts" to the invention as described and claimed. 247 The Full Court pointed out (at [33]) that the role of joint inventors is not necessarily equal and is qualitative rather than quantitative. The contributions may be joint or independent. The issue is whether a contribution is to the invention, as determined from the patent specification, including, but not limited to, the claims. In some cases, the reduction of a concept to practice or to a working apparatus may be part of the invention, in other cases it may not be. 248 Polwood does not change Australian law in respect of the identification of inventorship. The law remains that a putative inventor or putative joint inventor must have made a material contribution to the invention. What the case illustrates is that the reduction to practice of an inventive concept may or may not require an invention or inventive step. If not, reduction to practice does not demonstrate inventorship. 249 Contrary to UWA's assertions that French J erred in principle, the real issues that his Honour was required to determine were factual. They included the time by which any inventive contribution by Dr Gray was complete by reference to the timing of his employment by UWA, and whether further work of testing or experimentation falling within the period of his employment formed part of a continuing process of invention or was mere verification or reduction to practice. If the latter (as his Honour found) that work is not relevant to the identification of the inventor.

Consideration of Grounds 10-12 250 In addition to the general observations that we have made above about these grounds of appeal, two further observations should be made. 251 First, none of UWA's submissions about the issues of ideas, inventive concepts, inventions, verification and reduction to practice through testing and experimentation, effectively challenge the primary Judge's criticisms in [1347] to [1356] of the reasoning underlying UWA's case. In those paragraphs his Honour observed that the sources of UWA's asserted property rights and interests appeared at times to change during the course of the case. Justice French was careful to expose the difficulties to which terms used to describe a right or interest might give rise. His Honour's analysis led him to conclude that the rights that UWA asserted to the inventions had to be understood as including the right to apply for a patent and the right to take an assignment of a patent. UWA's appeal grounds make no complaint about this aspect of the primary Judge's reasoning. 252 Second, although expressed as separate grounds of appeal, Grounds 10 to 12 (at least in so far as UWA made submissions in support of them) overlap with Grounds 18 to 41. We adopt the same approach as do UWA's submissions by dealing with Grounds 10 to 12 separately to the extent that they allege error by the primary Judge in respect of the identification of legal principle. We will deal with UWA's more detailed submissions about factual matters when we address overlapping grounds that it pressed. 253 Ground 10, as identified in the notice of appeal, may be dismissed in short order. As Dr Gray submitted, French J did not simply apply Burroughs Wellcome and Apotex. The paragraphs of the reasons referred to in Ground 10 ([1426], [1442] and [1443]) form part of a much lengthier discussion about UWA's claim that during the course of his employment Dr Gray "developed and/or discovered certain inventions". This necessitated a discussion of what constitutes an invention and developing and/or discovering an invention. The discussion, in so far as it concerns issues of principle, extends from [1410] to [1443] of his Honour's reasons. As part of that discussion, his Honour identified UWA's claims and the difficulties that they masked (at [1410]-[1417]). His Honour also identified the steps the subject of complaint by UWA but which Sirtex contended were appropriate, as follows (at [1418]): 1 Identify the "inventive concept" of each relevant invention as defined by the claims in the relevant Patent Cooperation Treaty [sic - PCT application]. 2 Determine inventorship including the person responsible for the inventive concept and the time of conception as distinct from its verification and reduction into practice. 3 Determine how many contractual or fiduciary relationships between UWA and the inventors at the time of the inventorship gave rise to the proprietary rights claimed by UWA. 254 From [1421] to [1443] his Honour discussed the principles to be derived from authorities about the meaning of an "invention", a matter relevant to both the implied term argument (which French J had rejected) and the question of any notification obligation under the Patents Regulations (at [1419]). In this context French J referred to decisions distinguishing between discoveries or ideas and inventions and the notion of the "inventive concept", as well as the line to be drawn, where appropriate (it is not a "bright line"- see [1441]) between a complete invention on the one hand and its verification or reduction to practice on the other. These decisions included Lockwood, Burroughs Wellcome, Apotex and Polwood. 255 His Honour accepted (at [1442]) Sirtex's approach as according with the established notion of inventive concept and the identification of an invention for the purposes of the Patents Act. In so doing his Honour noted also that the approach was consistent with authorities in Australia, Canada and the United States that he discussed at [1421]ff. This led to his Honour's general conclusion at [1443] that: …the invention in each case in these proceedings is generally to be found described in the relevant specification which will be, for the most part, the applicable PCT specification. The time at which the invention was developed and the person by which [sic - whom] it was developed is to be ascertained by reference to the inventive concept of the invention so described. The time of invention, and the identity of the inventor will not be affected by the subsequent process of reduction to practice some elements of which may have found their way into the claims in the application. 256 The primary Judge was presented with competing arguments about the correct approach in principle to UWA's claims of ownership of certain inventions. Sirtex focused on the inventive concept - an approach that his Honour accepted. UWA focused on the solution to a problem as disclosed in the narrowest claim or claims in the relevant specification. His Honour correctly rejected UWA's approach, and UWA has failed to identify any error in his Honour's reasons for doing so that would justify intervention on appeal. 257 It should be apparent from these observations that Ground 10 of the notice of appeal, as framed, cannot be sustained in the face of the actual process of reasoning that the primary Judge adopted. The premise of Ground 10, that French J simply applied Burroughs Wellcome and Apotex without regard to the particular factual context, is unfounded. 258 In any event, and as Dr Gray submitted, UWA's submissions on Grounds 10 and 11 did not reflect the terms of the notice of appeal. In its submissions on Ground 12, UWA claimed, first, that French J failed to discern the invention from the specification as a whole, contrary to Polwood at [60] (set out at [222] above). Apart from inconsistency with its case at trial, the substantive difficulty for UWA is that French J's general conclusion at [1443] (set out at [255] above) is consistent with the reasoning in Polwood and inconsistent with the erroneous approach that UWA attempts to attribute to his Honour. This is unsurprising given that his Honour considered the decision in Polwood in some detail (at [1434], [1438] and [1441]). 259 UWA's observation that his Honour's reasons provide more detail about the claims than about other parts of the specifications also fails to make good its case on appeal. The relative level of detail of description in the reasons does not indicate that his Honour failed to apply the principles which he correctly identified from his analysis of other decisions. As the Full Court stated in Polwood at [60], the claims "represent the patentee's description of the invention sought to be protected and for which the monopoly is claimed". The claims are an important part of the specification and French J was entitled to consider them. In any event, and as Dr Gray submitted, a fair reading of his Honour's reasons discloses that his Honour did consider each specification as a whole. His Honour's reasoning on these issues is set out at [1448]-[1537]. 260 Ground 11 of the notice of appeal, which asserts some general error in his Honour's analysis of authority concerning the distinction between an invention or inventive concept and verification or reduction to practice, and his Honour's application of it to the facts of the case, cannot be sustained. 261 Further, contrary to UWA's submissions and as French J correctly recognised (at [1441]), the decisions in Lockwood and Polwood, especially Polwood at [60] (set out at [222] above),cannot be reduced to a single bald proposition that in every case an invention is complete only when one of ordinary skill in the art can perform it. This also confuses invention or inventive concept with the requirements for a valid patent. 262 Finally, UWA's contention that French J failed to deal with the Deed of Assignment dated 1 May 1997 consistently with Polwood is difficult to follow. UWA has not explained why such an analysis was required or how its absence involved any error. 263 It follows that in its submissions in support of Grounds 10 to 12, UWA has not identified any of the suggested errors of reliance on the foreign authorities (Ground 10), of finding that verification or reduction to practice lay outside the scope of the invention or inventive concept (Ground 11) or of failing to apply Polwood (Ground 12). Accordingly, those Grounds cannot be sustained. As Dr Gray submitted and as noted above, the ultimate questions the primary Judge had to determine were factual. 264 In so far as sub-paras (a) to (d) of Ground 12 identify factual findings which UWA submits French J ought to have made (separate from the alleged failure to apply the reasoning in Polwood, which we reject) our conclusions follow. 265 Sub-paragraphs (a) to (d) of Ground 12 identify ultimate conclusions which UWA contends French J ought to have reached, but UWA has not identified any error in French J's reasoning process which led his Honour not to reach them and to reach different conclusions, apart from the general submission, rejected above, of a failure to apply Polwood. 266 Moreover, the ultimate conclusions that UWA says should have been made are inconsistent with the factual findings that his Honour did make. 267 Sub-paragraph (c) contends that all of the research and experimentation that Dr Gray undertook at UWA between 1 January 1985 and 1 May 1997 was directed by Dr Gray to determining whether the concepts or ideas referred to in sub-paragraph (a) could be applied and made workable in a practical context, being the use of microspheres as a delivery mechanism for the treatment of liver cancer. Sub-paragraph (d) contends that all of that research and experimentation was done or directed by Dr Gray in his capacity as Professor of Surgery employed by UWA between 1 January 1985 and at least 1 May 1997. These contentions, however, cannot stand in the face of the findings of fact that French J made about the timing of the development of the inventive concepts underlying the respective inventions (however, as to the DOX-Spheres Invention, see [1506]-[1507] of his Honour's reasons, and [333]ff below). 268 Otherwise sub-paragraphs (a) to (d) of Ground 12 do not rise above mere assertion of findings that should have been made by some different characterisation of the evidence, without reference to any error capable of undermining the findings that his Honour in fact made. 269 It follows that UWA has not made good its claims of error by the primary Judge in Grounds 10 to 12 as identified in the notice of appeal and as argued.

E Grounds of Appeal 13-17: patents (general) 270 As noted at [14] above, for the reasons there given we do not address these grounds as independent grounds of appeal.

F Grounds of Appeal 18-21 (SIRT-1) and 22-25 (SIRT-2): patents (specific) - SIRT-1 INvention AND SIRT-2 invention

Factual background to Grounds 18-21 and 22-25 271 We requested the parties to prepare a brief statement of agreed basic and uncontroversial facts. Unfortunately and disappointingly, although the document filed in response to this request stated some facts that were agreed, it contained many that were not agreed, either at all or without substantial modification or addition. Despite this, we have isolated below from the document certain facts about the SIRT-1 and SIRT-2 Inventions (and in due course about the DOX-Spheres and Thermo-Spheres-1 Inventions) that are relevant to the disposition of the appeal. 272 The microspheres of the SIRT-1 Invention are comprised of a polystyrene divinyl benzene (resin) matrix into which a radionuclide is incorporated. The microspheres of the SIRT-2 Invention are hollow or cup-shaped and comprised of pure Yttrium Oxide which is rendered radioactive by neutron bombardment. 273 The SIRT-1 Invention was the first SIRT-Spheres invention developed by Dr Gray. However, he considered it to be a first generation product and less than satisfactory because of the use of the polymer matrix. Dr Gray wanted to develop pure Yttrium microspheres as a second generation product which would replace the polymer matrix microspheres of SIRT-1. 274 The first patent application relating to the SIRT-Spheres Inventions related to the SIRT-2 Invention and was applied for by Dr Gray in his own name on 21 January 1994 and named him as inventor. This was complete Application No 54724/94 entitled "Radioactive Particles for Treatment of Cancer". 275 On 20 January 1995, Dr Gray filed in his own name PCT Application No PCT/AU95/00027 claiming priority from complete Application No 54724/94, that is to say, from 21 January 1994. This application was entitled "Particulate Material" (the SIRT-2 PCT Application). 276 The SIRT-2 PCT Application in its "Summary of the Invention" describes four aspects. These are: (a) a particulate material comprising hollow or cup-shaped ceramic microspheres having a diameter in the range of from 5 to 200 microns; (b) a process for the production of the above particulate material; (c) a method of radiation therapy of human or other mammalian patients, comprising administration to the patient of a radioactive particulate material as described above; and (d) the use of a radioactive particulate material as described above in radiation therapy of a human or other mammalian patient. 277 Examples 1 and 3 describe the production of the microspheres. Example 1 sets out the optimal torch conditions and Yttria powder conditions to produce hollow Yttria microspheres with a size range from 20 to 80 microns. Example 2 describes the technique of SIRT (ie. Selective Internal Radiation Therapy) when used on a patient. In particular, it notes that by use of the technique, an amount of Yttrium90 activity that will result in an inferred radiation dose to the normal liver of approximately 80Gy may be delivered. 278 Dr Gray assigned the SIRT-2 PCT Application to Paragon Medical by the Deed of Assignment made between him and Paragon Medical on or about 1 May 1997. 279 On 13 August 1998, Australian Patent 690630 entitled "Particulate Material" in respect of the SIRT-2 Invention was sealed. The patent was granted to Paragon Medical, and named Dr Gray as inventor. 280 The first patent application relating to the SIRT-1 Invention was filed on 16 March 1999. The applicant was Paragon Medical and Dr Gray was named as inventor. This was Provisional Patent Application No PP9228 entitled "Production of Resin Based Radionuclide-Containing Microspheres" (at [1448]). This application lapsed without publication on 16 March 2000. 281 A second application relating to the SIRT-1 Invention was filed on 25 October 2000 by Sirtex (Paragon Medical had changed its name to Sirtex on or about 4 April 2000), again naming Dr Gray as inventor. This was Provisional Patent Application No PR0983 entitled "Polymer Based Radionuclide Containing Microspheres" (at [1452]). This provisional application served as the priority document for PCT Application No PCT/AU01/01370 which was filed on 25 October 2001 (the SIRT-1 PCT Application). The SIRT-1 PCT Application was also filed by Sirtex and also named Dr Gray as inventor. Its title was "Polymer Based Radionuclide Containing Particulate Material". 282 The SIRT-1 PCT Application summarised the invention as having three aspects: (a) a particulate material having a diameter in the range of from 5 to 200 microns comprising a polymeric matrix and a stablyincorporated radionuclide; (b) a process for the production of the above particulate material comprising the step of combining a polymeric matrix and a radionuclide for a time and under conditions sufficient to stablyincorporate the radionuclide in the matrix; and (c) a method of radiation therapy of a patient which comprises the administration of the above particulate material to a patient. The SIRT-1 PCT Application also stated that the invention provided for the use of the above particulate material in the radiation therapy of a patient.

283 There are three examples in the SIRT-1 PCT Application. 284 Example 1 describes the making of the particulate material, including, at page 9 lines 14 to 17, the washing of the microspheres with a phosphate buffer solution until the pH of the wash solution is less than 9 and preferably less than 8.5. Following the washing of the microspheres with water, the microspheres are resuspended and diluted, if necessary, with water. The microspheres produced by the described method will have a low level of leaching of Yttrium90 when tested in accordance with the test procedure set out in Example 1. 285 Example 2 and the associated Fig 1 record experiments showing the effect of phosphate concentration in the precipitation solution and the effects of washing with phosphate buffer on the pH of a microsphere suspension. 286 Example 3 describes the technique of SIRT (ie Selective Internal Radiation Therapy) when used on a patient. In particular, it notes that by use of the technique, an amount of Yttrium90 activity that will result in an inferred radiation dose to the normal liver of approximately 80Gy may be delivered.

Consideration of Grounds 18-21 (SIRT-1) 287 By Grounds 18-21 UWA claimed, in essence, that the primary Judge erred in concluding (at [1470]) that the inventive concept underlying SIRT-1 was discovered before Dr Gray was employed by UWA. The error was said to arise because, first, his Honour failed to apply the reasoning in Polwood at [60] (set out at [222] above) and, as a result, erroneously identify the inventive concept of the SIRT-1 Invention; and, second, his Honour did not correctly identify the state of Dr Gray's knowledge relevant to the development of the SIRT-1 Invention as it was before he became employed by UWA. 288 In so far as these alleged errors were said to flow from a failure to apply the reasoning in Polwood at [60], UWA's submission must be rejected. The fact that French J recorded the 23 claims in his account of the SIRT-1 PCT Application (at [1454]) does not mean that he failed to consider the specification as a whole. His Honour's observations at [1448] to [1453] make it plain that he did consider it as a whole. We note that we have already rejected the present submission in dealing with Grounds 10-12. 289 UWA submits: As the invention in the SIRT 1 PCT application was expressed to be an advance upon the above "Background" work done at the University, the judge's finding that the "inventive concept underlying SIRT-1 was discovered prior to Dr Gray commencing employment at UWA" [1470] cannot be supported. The finding is against the express statements in the SIRT 1 PCT specification itself. It is true that French J stated (at [1470]) that the inventive concept underlying SIRT-1 was discovered before Dr Gray commenced employment at UWA. But it should be made clear that the SIRT-1 PCT Application did not state that that application was an advance upon "Background" and characterise the background work as having been done at UWA. UWA's submission set out above might suggest that it did so. 290 His Honour did not separately and expressly identify the inventive concept of SIRT-1. However, it is implicit in what his Honour said at [1466]-[1470] that he accepted Dr Gray's submission that it "comprised the discovery and incorporation of the 'phosphating method' used to chemically fix the Yttrium so that it was permanently embedded in the microsphere matrix". We know from [1470] that his Honour considered that the inventive concept was discovered before Dr Gray took up his appointment at UWA in February 1985. At [1468]-[1469] his Honour took pains to demonstrate that the concept mentioned was arrived at before Dr Gray commenced at UWA. At [1468]-[1469] his Honour expressed his conclusion on various points favourable to Sirtex's submissions and unfavourable to those of UWA. 291 It is agreed that: (a) The specification of the SIRT-1 PCT Application refers to the work of Burton, Gray and Colletti, "Effect of Angiotensin II on Blood Flow in the Transplanted Sheep Squamous Cell Carcinoma", Europ J Cancer Clin Oncol 1988, 24(8):1373-1376 which was one of the papers that the trial Judge found reported research undertaken by Dr Gray's team at UWA during the period 1985 to 1987. (b) The SIRT-1 PCT Application also refers to the known problem that if the particles are too dense or heavy, they will not distribute evenly in the target organ. Lighter microspheres with a specific gravity of the order of 2.0 distribute well within the liver. This was demonstrated in Burton et al, "Selective Internal Radiation Therapy: Distribution of Radiation in the Liver", Europ J Cancer Clin Oncol 1989, 25(10):1487-1491. The trial Judge found (at [426]) that this paper reported on work done by Burton, Gray, Klemp, Kelleher and Hardy at UWA up to 1988/1989. (c) The SIRT-1 PCT Application refers to some problems identified "[i]n the earliest clinical use of yttrium-90 containing microspheres". As set out below, clinical use of SIRT-1 commenced in November 1986 during the period that Dr Gray was a full time employee of UWA. The SIRT-1 PCT Application states that while the microspheres were of an appropriate density to ensure good distribution characteristics in the liver, "there were several instances in which the yttrium-90 leached from the microspheres and caused inappropriate radiation of other tissues". 292 As to (a) above, Dr Burton's first project at St Vincent's Hospital in 1983 had been to examine vasoactive agents which could influence blood supply in the liver and in a liver tumour and drugs that would constrict vascular flow in normal liver tissue. Using angiotensin-2, Dr Burton demonstrated that the blood flow could be manipulated to increase the entry of microspheres. His first major publication in relation to this work appeared in 1985 (at [291]-[292]). It was during preliminary experimentation that Dr Burton and his colleagues noticed some leaching of the radioactive isotope from the microspheres. A solution to that problem was suggested by Dr Hodgkin of the CSIRO in 1982 or 1983, namely, precipitating the Yttrium90 onto the beads as an insoluble salt (at [294]). 293 As to (c) above, it was while he was at the University of Melbourne that Dr Gray had been given permission to commence human experiments (at [299]). However, in order to avoid aborting the clinical project by reason of his relocation to Perth to take up the Chair of Surgery at UWA, Dr Gray had deferred treating patients with the SIR-Spheres until after the relocation (at [313]). There are extensive discussions of early clinical use of microspheres including an article by Edgar Grady published in 1979 and an article by Ariel and Padul reporting on the treatment of 40 patients (at [275]). Indeed, human trials involving ceramic microspheres go back to as early as 1962 (at [270]). 294 It does not follow from the fact that further work was done at UWA that the inventive concept had not been arrived at before Dr Gray began there in February 1985. 295 As Dr Gray submitted, UWA identified three "problems" that it asserted were required to be solved before the invention was complete. These problems were the selection of microspheres suited to deliver radioactive isotopes to diseased tissue; a method of incorporating the radioactive isotopes in the microspheres so that they would not dislodge or leach following administration to a living organism; and the use of the microspheres with immobilised radioactive isotopes in the treatment of diseased tissue (see [1456]). The primary Judge dealt with the time at which each of these problems was solved because this problem/solution approach represented UWA's case as put at its highest. UWA's submissions on appeal attempt to re-cast this as an error by reference to Polwood but the argument cannot be sustained on any fair reading of his Honour's reasons. For similar reasons, UWA's submission that French J erred because he considered "prior art features taken individually, rather than the features in combination as described" in the SIRT-1 PCT Application must be rejected. 296 UWA's submissions on appeal define the inventive concept underlying the SIRT-1 Invention as involving three key aspects: (a) The solution to the problem of leaching; (b) A polymeric matrix which is "more preferably" about 4% cross-linked and of the microsphere size of "most preferably" 30-35 microns in diameter; and (c) An ability to deliver an efficacious dosage of radiation in the order of 80Gy safely to the tumour. UWA submits that these key aspects were achieved in combination to enable a workable treatment while Dr Gray was employed by UWA. 297 As discussed, before the primary Judge UWA repudiated the approach of identifying the inventive concept of an invention. It is not open to it to complain on appeal that his Honour failed to make findings about an inventive concept or inventive concepts of the SIRT-1 Invention which were never identified at trial. Conversely, UWA's complaint about French J's focus in [1468] and [1469] on specific integers fails to acknowledge that those were the very "problems" that UWA identified at trial as resulting in "solutions" that constituted the invention. So much is apparent from his Honour's account of UWA's submissions at [1456]-[1465]. 298 Leaving aside these difficulties, UWA said that that the SIRT-1 PCT Application gave some basis for identifying two inventive concepts, the first relating to the microspheres and the second to the radiation dosage. Yet UWA's own description of the second alleged inventive concept (as involving efficacious and safe treatment) supports his Honour's finding that the particular dosage was not an element of the inventive concept underlying SIRT-1 (at [1469]). As Dr Gray submitted, it is implicit in the primary Judge's findings that he considered the question of dosage to be mere verification or testing. We agree. 299 The primary Judge stated (at [304]) that by the time Dr Gray commenced his employment at UWA in February 1985, he and those working with him had established various elements of the use of microspheres to deliver targeted radiotherapy to liver tissues, namely: 1. The use of microspheres to transport an irradiated isotope of Yttrium into the vasculature of liver cancers in order to deliver lethal radiation to the tumour without significant harm to normal liver tissue. 2. The use of microspheres for that purpose comprising styrene-divinyl benzene copolymer ion exchange matrix to incorporate the Yttrium90. 3. The use of vasoactive agents including angiotensin-2 to create enhanced vascular flow into cancerous tissue and effect preferential distribution of injected microspheres into that vasculature. 4. Precipitation of Yttrium90 as a phosphate salt to bind it sufficiently strongly to the microsphere matrix that the risk or incidence of leaching of the Yttrium90 into the general circulation while it remained radioactive was reduced to acceptable levels. 5. The possible use of microspheres in the size range of 30 microns to optimise preferential lodgment in tumour tissue. These findings of fact support his Honour's conclusion at [1470] that the inventive concept underlying the SIRT-1 Invention was discovered before Dr Gray commenced his employment at UWA. 300 As to the specific complaints made by UWA about French J's findings (at para 24ff of its principal submissions), the general answer is that his Honour analysed the various articles and papers (at [1468]-[1469]), by reference to the inventive concept in a manner consistent with legal principle, and duly reached the conclusion that the concept was arrived at before Dr Gray's employment by UWA. UWA alleges a different conclusion without persuasively identifying any respect in which French J erred. 301 Consistent with Dr Gray's submissions, the factual and other errors that UWA identifies in para 24(a)-(f) of its principal written submissions, are not well-founded. Hence: (1) As to microsphere size (para 24(a)): UWA's submissions do not expose any error in French J's conclusion at [1468] that Dr Meade's 1987 article, although based on work performed on rats, could be extrapolated to human liver tissue based on Dr Burton's evidence, and that, in any event, the particular size of 32.5 microns was not part of the inventive concept underlying the SIRT-1 PCT Application. (2) As to microsphere density (para 24(b)): the fact that the Kim article did not discuss features other than specific gravity, which was only one feature of the SIRT-1 Invention, is beside the point. His Honour (at [1469]) did not suggest otherwise. He dealt with other features separately, finding, for example, that the use of styrene/divinyl benzene "was [also] an element of the invention well before Dr Gray arrived at UWA" (at [1469]). Accordingly, para 24(b) discloses no error. (3) As to styrene/divinyl benzene (para 24(c)): no inaccuracy is alleged by UWA with respect to French J's finding that the use of styrene/divinyl benzene was an element of the invention before Dr Gray started at UWA. Rather, the complaint is that, accepting that styrene/divinyl benzene was an element of commercially available microspheres before Dr Gray commenced employment at UWA (such as Biorad microspheres), none of those microspheres had been used in conjunction with all the other aspects of the invention, including vasoconstrictive agents (angiotensin-2), Yttrium90, 80Gy dosage of radiation, and manufacture and storage to prevent leaching. We do not think, however, that this complaint exposes error. It would do so only if the inventive concept was the combining or bringing together of all of those features. (4) As to cross-linking (para 24(d)): French J found (at [1469]) that the Self paper of 1984 described the use of 32 micron Yttrium90 microspheres which were 4% and 8% cross linked. The fact that the paper was not published is not to the point. Nor is the fact that Dr Self was not called to give evidence as to the accuracy of the content of the paper. The primary Judge was entitled to rely on the paper to support his finding at [1469]. UWA's complaint that the Self paper does not describe other key features of the SIRT-1 Invention such as the storage of microspheres in pH conditions preferably less than pH 7.5 and the use of 80Gy dosage of radiation does not expose error, because the inventive concept did not consist of combining or bringing together all such features. (5) As to the leaching problem (para 24(e)): the evidence supports French J's findings about stable incorporation (at [1469]). His Honour also referred to this question at [287], [294]-[296], [304]-[305] and [363]. UWA's analysis of the issue fails to recognise that Dr Cameron Jones's work done as part of Dr Gray's team at UWA primarily concerned what French J described as "improvements in the phosphating process" during storage (at [305]). The "break through" and "critical achievement" (Dr Burton's words) with respect to the use of phosphate, however, had occurred in 1983 and 1984 at the University of Melbourne, that is to say, before Dr Gray started at UWA in February 1985 (at [296]-[297]). (6) As to angiotensin-2 (para 24(f)): UWA effectively acknowledges that the evidence supported his Honour's finding (at [1469]) that the use of angiotensin-2 to achieve preferential blood flow into rat and rabbit liver tumour tissue was established before 1985. UWA's complaint that the studies did not involve use of other elements of the SIRT-1 Invention, such as the preferable 30-32 micron microspheres or the 80Gy dosage of radiation, or the manufacture and storage to prevent leaching, is beside the point for the reasons given at (2), (3) and (4) above in relation to the similar argument put by UWA in respect of specific features of the SIRT-1 Invention that were not a part of, or necessary for, the inventive concept, alone or in a combination. 302 As to Dr Gray's state of knowledge, French J's findings about the prior art are not based on uncorroborated evidence of Dr Gray about his state of mind, contrary to the caution that his Honour sounded in [978] against accepting Dr Gray's uncorroborated evidence on contentious issues. His Honour's reasons focus primarily on documents, as the findings at [1468] and [1469], [1484] and [1485], [1503] and [1535] and [1536] make clear. 303 None of the errors asserted in Grounds 18 to 21 are sustainable. In particular, the primary Judge did not wrongly focus his inquiry as alleged in Ground 18. He did not fail to have any or any proper regard to the information about the SIRT-1 Invention as described in the SIRT-1 PCT Application, Provisional Patent Application No PP9228 or Provisional Patent Application No PR0983, or to the work carried out at UWA, as claimed in Ground 19. Nor did he fail to have regard to the articles and work identified in Ground 20. And as Dr Gray submitted, UWA's claim in Ground 21 that French J should have made certain findings does not rise above mere assertion.

Consideration of Grounds 22-25 (SIRT-2) 304 The primary Judge found that the inventive concept of the SIRT-2 Invention was completed by Dr Gray by 1982, before he commenced at UWA, and that subsequent work was "in the nature of verification or reduction to practice" and "not by way of conception giving rise to inventorship and entitlement". By these grounds of appeal UWA challenges this finding. 305 His Honour described (at [1486]) the SIRT-2 inventive concept as being in the broad terms of claims 1, 11, 12 and 16 of the SIRT-2 PCT Application. Those claims were as follows: 1. A particulate material comprising hollow or cup-shaped ceramic microspheres having a diameter in the range of from 5 to 200 microns. 11. A method of radiation therapy of a human or other mammalian patient, which comprises administration to the patient of a radioactive particulate material comprising hollow or cup-shaped ceramic microspheres, said microspheres comprising a beta- or gamma-radiation emitting radionuclide and having a diameter in the range of from 5 to 200 microns. 12. A method according to claim 11, wherein the microspheres consist of or comprise Yttria or another Yttrium-containing compound as base material and the radionuclide is Yttrium90. 16. Use of a radioactive particulate material comprising hollow or cup-shaped ceramic microspheres, said microspheres comprising a beta- or gamma-radiation emitting radionuclide and having a diameter in the range of from 5 to 200 microns, in radiation therapy of a human or other mammalian patient. 306 Again, UWA contended that his Honour erred in his approach to inventive concept by focussing only on selected claims rather than considering the whole of the specification for the SIRT-2 PCT Application as required by Polwood at [60] (set out at [222] above). According to UWA, his Honour's finding was wrong because it was inconsistent with that part of the specification that described the invention as an advance on work carried out at UWA. 307 As in the case of the SIRT-1 PCT Application, it should be made clear that nowhere does the SIRT-2 PCT Application identify any particular work as having been carried out at UWA. It is UWA that makes that attribution. 308 UWA also claimed that French J appears to have accepted that the "mere idea" that microspheres should be made of pure Yttrium and be hollow or cup-shaped or have voids sufficed to constitute the SIRT-2 inventive concept. From the specification as a whole, however, it is apparent that the inventive concept included hollow or cup-shaped pure Yttrium microspheres, a process for their production, and a method of safely and efficaciously administering radiation treatment to patients using them. The process of production described in the specification reflected the work of Gordana Pravdic between 1992 and 1994. The method of treatment described in the specification (including in claims 12 to 18) was not known to Dr Gray in 1982 and was possible only because of his work at UWA and in collaboration with researchers from Monash University between 1989 and 1994. 309 UWA submitted that on this evidence French J should have found that in 1982, Dr Gray had had only a very generalised idea of the possible utility of pure Yttrium90 microspheres with voids and not a definite and permanent idea of the complete and operative SIRT-2 Invention. The other aspects of the inventive concept relating to process and method were not mere verification or reduction to practice. The consequence, according to UWA, is that his Honour should have found that the SIRT-2 inventive concept was not achieved by Dr Gray before he commenced at UWA in 1985. 310 In so far as these alleged errors were said to flow from a failure to apply the reasoning in Polwood at [60], UWA's submissions must be rejected. His Honour's reasons show that he considered the whole of the specification relating to the SIRT-2 PCT Application (see [1479]-[1484]). His conclusion does not disclose an inappropriate focus on selected claims in the specification. Rather, he found (at [1486]) that by 1982 Dr Gray had completed the SIRT-2 inventive concept "in the broad terms of claims 1, 11, 12 and 16". The language of this conclusion is inconsistent with the error identified by UWA. His Honour's reference to the broad terms of the four claims mentioned was a convenient shorthand way of identifying the inventive concept. The invention and the examples had been described by his Honour more discursively in preceding paragraphs of his reasons. 311 There is no inconsistency between the primary Judge's conclusion and the account given in the specification of background work, whether carried out at UWA or elsewhere. A specification may include an account of work in the nature of verification or reduction to practice. Reduction to practice may or may not be part of the inventive concept. It is not the case that all and any work described in a specification will necessarily expose or be part of the inventive concept underlying the invention. 312 It is not the case that the primary Judge considered it sufficient for Dr Gray to have a "mere idea" that microspheres should preferably be made of pure Yttrium and be hollow or cup-shaped or have voids. His Honour did not draw any conclusion by reference to mere ideas. Indeed, the principal purpose of the discussion at [1419] to [1443] is to distinguish between ideas and inventions. His Honour focused on the inventive concept for the purpose of distinguishing an idea from an invention and from mere verification or reduction to practice. In other words, UWA seeks to attribute to French J an error (the sufficiency of a mere idea) which his Honour was in fact at pains to expose and analyse in a manner consistent with authority. It is apparent from his analysis of the competing submissions (at [1471]-[1478]) that his Honour simply did not accept UWA's characterisation of the facts. UWA has not exposed any error in the reasoning process that led his Honour to his own characterisation of them. 313 UWA's assertion in Ground 23 that French J failed to have any or any proper regard to various matters is also unfounded. His Honour referred to Patent Application No 54724/94 (see [274] above) at [678]-[679], [1272], [1278], [1330], [1334], [1444] and [1471]. He was plainly aware of that patent application and its significance for UWA's case. Justice French simply did not accept (at [1478]) that UWA's problem/solution approach adequately addressed the inventive concept of SIRT-2 which it was necessary to identify in order to determine the point of invention and inventorship. He applied (at [1478]) the inventive concept approach for the reasons already discussed. As the High Court observed in Lockwood at [64]-[65], the problem/solution approach is not necessarily appropriate for the identification of the invention or inventive step. 314 The same observation may be made about the SIRT-2 PCT Application. The primary Judge referred to that application at [1272]-[1274], [1278], [1334] and [1480]. His Honour's decision about the SIRT-2 inventive concept depended on his analysis of the SIRT-2 PCT Application (at [1480]-[1485]). The suggestion that his Honour failed to consider or properly consider that application should not be accepted. For the same reason the claim that his Honour failed to consider or properly consider research and experimentation that Dr Gray carried out at UWA misses his Honour's point about the significance of the inventive concept. Nor, in the face of his Honour's reasons, can it be said that he failed to consider or properly consider Dr Gray's name being on the Register of Patents. 315 For the reasons already given, in relation to Ground 24, which was to the effect that his Honour erred by failing to have regard, or sufficient regard, to the references in the SIRT-2 PCT Application specification to work undertaken at UWA after 1985 for the purposes of identifying the inventive concept underlying SIRT-2, that ground is unsustainable. 316 Ground 25 depends on the earlier grounds being upheld and does not require independent consideration. In any event, as with Ground 21 (see [303] above), this ground does not rise above mere assertion. 317 None of Grounds 22 to 25 are sustained. The primary Judge did not focus on the existence of a mere idea. He applied the notion of inventive concept which UWA, on appeal, accepts as correct. His Honour did not focus only on specific claims of the relevant specification. He did not conceive of the inventive concept simply by reference to selected claims or individual integers. Nor did he fail to have regard to any salient matter.

G Grounds of Appeal 26-28: patents (specific) - DOX-Spheres invention

Factual background to Grounds 26-28 318 On 18 November 1993, Drs Gray and Chen filed Provisional Patent Application No PM2492 entitled "Controlled Release Matrix for Drugs and Chemicals" (DOX-Spheres Provisional Patent Application). They were also the named inventors. Dr Chen was the author of this provisional application. Dr Gray said that he put his name down as co-inventor because he had initiated the DOX-Spheres project, although he had not done any of the experiments. 319 A PCT application claiming priority from Provisional Patent Application PM2492 was filed on 17 November 1994 on behalf of CRI as applicant also naming Drs Gray and Chen as inventors. It was numbered PCT/AU94/00708. Its invention was entitled "Controlled Release Preparation" (the DOX-Spheres PCT Application) (at [685]). 320 By the Deed of Assignment made between Dr Gray and Paragon Medical on 1 May 1997, Dr Gray assigned to Paragon Medical whatever interest he possessed in the DOX-Spheres PCT Application. 321 Drs Gray and Chen had acquiesced in the naming of CRI as applicant in the DOX-Spheres PCT Application. It was also necessary for CRI to assign its interest in that application to Paragon Medical. This was achieved by an Assets Purchase Deed entered into between Paragon Medical and CRI on the same day, 1 May 1997. 322 On 28 October 1997 a further instrument of assignment was executed between CRI and Paragon Medical respecting the DOX-Spheres PCT Application and corresponding foreign applications. 323 The specification of the DOX-Spheres PCT Application described (at p 4) the invention in the "Description of the Invention" section as: a controlled release preparation comprising an ionic polymer matrix loaded with an active compound, for example a pharmaceutically active compound, said active compound being complexed with a complexing agent to modify the release of the active compound from the polymer matrix. The "Description of the Invention" section of the specification continued (p 4): Preferably, the ionic polymer matrix is provided in the form of microspheres, for example microspheres in the size range of 10-200 micron in diameter and preferably in the range of 20-70 micron in diameter. In one preferred aspect of the invention (p 6), "microspheres of cross linked albumin and dextran sulphate are used as polymer matrices for ionic drugs such as DOX ... to achieve high drug loading". In another aspect of the invention, an ion exchange resin can be used, such as a polystyrene-divinylbenzene based ion exchange resin. The ionic polymer matrix of the controlled release preparation may be biodegradable or non-biodegradable. 324 Example 1 in the specification relates to making the biodegradable dextran sulphate DOX-Spheres (which had been made by Dr Chen for the purpose of experimentation). The trial Judge accepted that Dr Chen was the first to develop the combination of albumin and dextran sulphate in one albumin/dextran sulphate microsphere. 325 Example 2 records the results of in vivo use of the DOX-Spheres on four patients. Dr Chen was involved in that in vivo testing. 326 Example 3 describes the making of both the biodegradable and non-biodegradable DOX-Spheres. Again, Dr Chen was involved in this work. 327 Example 4 describes the use of a complexing agent (chitosan) to modify the release of the active compound from the polymer matrix. The microspheres are made from an albumin/dextran sulphate polymer matrix, complexed with chitosan in an attempt to suppress burst release. In that instance, the active chemotherapeutic drug is cisplatin rather than doxorubicin.

Consideration of Grounds 26-28 328 The primary Judge found (at [1503]) that the "inventive concept at the heart" of the DOX-Spheres Invention was "the use of metal ions to suppress burst release of doxorubicin from the microsphere carrier." 329 Contrary to UWA's submissions before him, his Honour found that this inventive concept did not include the use of combined albumin/dextran sulphate microspheres. In so finding, French J noted that Dr Chen had accepted that this combination was not a new invention. His Honour also noted that neither the selection of microsphere size nor the selection of anti-cancer drugs was an inventive step as at 1991 but, rather, a reduction of the inventive concept into practice (at [1502]). 330 His Honour rejected UWA's submission that the inventive concept at the heart of the DOX-Spheres Invention as described at [328] above could be attributed to Dr Chen. The inventive concept had been foreshadowed in 1982-3 by Dr Hodgkin of CSIRO in a paper entitled "Metal Chelating Polymers" which he wrote for the Encyclopaedia for Polymer Science,and by further research he had carried out by March 1986 (at [1503]). Dr Hodgkin's communication to Dr Chen was, according to his Honour's finding, the most likely explanation of a handwritten note made by Dr Chen in 1991 reading "Metal Chelat … ion exchange resin + DOX", and Dr Hodgkin again communicated with her about the use of metal ions and sulphonated dextran in February 1992 (at [1504]). 331 The primary Judge also considered that much of the experimental development of practical application of metal ion complexing to reduce burst release was carried out by Dr McCulloch, an employee of RPH. His Honour preferred the evidence of Dr McCulloch to that of Dr Chen where there was conflict between them over their respective roles (at [1505]). That credit finding is not the subject of a ground of appeal. We do not mean to suggest that it could have been. 332 These findings led to French J's overall conclusion concerning the DOX-Spheres Invention that Dr Chen was not a contributor to its inventive concept, as distinct from being a contributor to its reduction to practice and its verification in animal trials (at [1506]). 333 His Honour observed that the inventive concept "seems to have been developed by a combination of Dr Gray, Dr Burton, Dr Hodgkin and Dr McCulloch", albeit within the time frame claimed by UWA, that is to say, while Drs Gray, Burton and Chen were employees of UWA (at [1506]-[1507]). However, his Honour said (at [1506]): It may be debatable whether Dr Gray's contribution is sufficiently material that he could be regarded as a co-inventor albeit he initiated the line of research that sought to develop the idea of using microspheres to deliver anti-cancer drugs. 334 According to UWA, his Honour's findings demonstrate error. 335 UWA again alleged error by reference to the principles enunciated in Polwood. Consistent with the conclusions above, this ground cannot be sustained. Justice French had regard to more than the claims in the specification, as the discussion at [1494] to [1498] and [1499] to [1507] of his Honour's reasons makes clear. His Honour's conclusion about the relevant inventive concept did not result from error. His acceptance that Dr Chen developed the combination of the albumin and dextran sulphate in the one microsphere (at [571]), on which UWA relied, does not expose any error in his conclusions. 336 UWA contended that his Honour ought to have found that Dr Chen arrived at key parts of the inventive concept(s) of the DOX-Spheres Invention. As Dr Gray submitted, however, the difficulty with this submission is that it is not supported by his Honour's primary factual findings about Dr Chen's role (see [351], [548] to [592], [676] and [1503] to [1506]). In particular, French J had considerable reservations about key parts of Dr Chen's evidence, as disclosed by his Honour's comments at [562], [563], [583], [584], [592], [673], [1504] and [1505]. UWA failed to address these findings and their consequences for Dr Chen's evidence touching on her role. UWA's submissions on appeal asserted that different findings of fact should have been made without demonstrating any error of principle or logic in the primary Judge's approach. 337 Further, UWA's submissions about the contributors to the inventive concept as referred to by French J at [1506] are misconceived. His Honour framed his observations in this regard carefully because UWA's claim was only that either or both of Dr Gray and Dr Chen had discovered the DOX-Spheres inventive concept. His Honour did not accept that Dr Chen was a co-inventor of the inventive concept at the heart of the DOX-Spheres Invention. Having done so, it was not strictly necessary for his Honour to go on to make findings about the identity of the inventors. Nevertheless, as noted at [333] above, he said that the inventive concept seemed to have been developed by Dr Gray, Dr Burton, Dr Hodgkin and Dr McCulloch, although, as noted above, he thought that Dr Gray's contribution was debatable. 338 UWA has seized upon this observation to support its contention on appeal that UWA must own the invention. According to UWA this follows from the fact that two UWA employees had contributed to the inventive concept (Dr Gray and Dr Burton), whereas Dr McCulloch had been "seconded" to UWA to work directly under Dr Chen's supervision, and Dr Hodgkin had made no claim to be a contributor to the invention, his involvement being limited to the suggestion he made to Dr Chen in 1991 to use a ferric ion to complex with doxorubicin. Parts of this contention, however, are inconsistent, not only with French J's observations read as a whole, but also with UWA's own submissions made in support of this ground of appeal. Hence, later in those submissions, UWA asserts that neither Dr Gray nor Dr Burton (the two UWA employees) had made any contribution to the solution of the problem of burst release. 339 Certain matters are clear. 340 His Honour said that it was "debatable" whether Dr Gray's contribution was sufficiently material for him to be regarded as a co-inventor. In so far as UWA relied on Dr Gray's contribution as founding its submission as to ownership, its case is undermined by this observation, as it is by its own concession that Dr Gray had no involvement in solving the problem of the burst release of doxorubicin from the microsphere carrier. 341 Similarly, UWA cannot assert both that because Dr Burton was an employee of UWA, UWA owned the DOX-Spheres Invention, and that French J should have found that Dr Burton had no involvement in the development of this invention. The latter submission undermines the former. 342 As to Dr McCulloch, UWA provided no references to findings of fact made by French J or evidence to support its contention that Dr McCulloch was seconded from RPH in 1992 and 1993 and worked directly under Dr Chen's supervision. Importantly, his Honour found that Dr McCulloch was at all material times an employee of RPH (at [580] and [1505]). His Honour found (at [580]) that Dr McCulloch was engaged on a half time basis in 1991 to work on a project to develop the optimum conditions to achieve a controlled and sustained release of drug from a doxorubicin microsphere. He conducted experiments using different ratios of ion to doxorubicin to observe optimal conditions for slow release of the drug. The primary Judge said that Dr McCulloch was "directed by Dr Gray and Dr Chen in relation to what his research was to involve" (at [580]). His Honour said that it appeared that Dr McCulloch was funded by the Medical Research Foundation at RPH, the funding having been arranged by Dr Gray. 343 UWA's submission should not be accepted in the face of French J's express finding that, at all material times, Dr McCulloch was an employee of RPH. 344 Further, UWA has not explained why French J was in error in accepting Dr McCulloch's evidence that, in critical respects, he worked alone, without any involvement of Dr Chen, and that Dr Chen was not "supervising" him, although they worked in the same laboratory (eg at [586] and [592]). Mere assertion that some different findings should have been made, without any attempt to identify error in the primary Judge's findings, is insufficient. This is particularly so where, as here, the primary Judge preferred the evidence of Dr McCulloch to that of Dr Chen, including for reasons of credit (see, for example, French J's observation at [592] that Dr Chen was "likely to be self-serving on important and contentious points relating to her own role in the research undertaken by Dr Gray's group"). Finally, UWA's apparent concern about an erroneous date reference (1991 instead of 1992 to 1993) is immaterial. His Honour correctly identified the dates of Dr McCulloch's work at [586], having noted at [580] that he had been engaged on a half time basis in 1991. 345 The primary Judge's findings about the difficulties with Dr Chen's evidence also undermine UWA's submission that she should have been found to have had a "comprehensive" role in the solving of the problem of burst release. The submission cannot be accepted in the face of his Honour's findings about the respective roles of Dr Hodgkin (at [351], [556] and [1504]), Dr McCulloch (at [578] to [592] and [1505]) and Dr Chen (at [548] to [592] and [1506]). Again, mere assertion, without identification of any error by the primary Judge, is of no real assistance. 346 It follows that UWA has not made good any of its contentions that his Honour should have found that UWA owned the DOX-Spheres Invention via Dr Chen's contribution to its inventive concept. 347 Specifically, French J's focus on the use of metal ions to suppress burst release of doxorubicin from the microsphere carrier (at [1503]) was not the result of an erroneous focus on only one claimed integer or feature, as asserted in Ground 26. It was the result of his Honour's identification of the inventive concept of the DOX-Spheres Invention in a manner consistent with authority. French J did not fail to consider the aggregation of features. He simply rejected UWA's problem/solution based approach as his comments at [1500]-[1502] show. Similarly, UWA's assertions in the balance of Ground 26 with respect to Dr Chen are incapable of supporting any finding of error by his Honour for the reasons already given. Equally, the remaining complaints made in Ground 26 about a failure to have proper regard to the Register of Patents and to make any finding about ownership of the DOX-Spheres Invention "as relevant to the claim of [UWA]" are not supported. 348 We return to Dr Gray and Dr Burton. As noted above, at [1506] and [1507] French J accepted that the inventors of the DOX-Spheres invention included them (debatably in the case of Dr Gray) and that their contribution was made while they were employees of UWA. In Ground 26(h), UWA asserts that French J erred in failing to make any finding about ownership of the DOX-Spheres Invention "as relevant to the claim of [UWA]". This ground of appeal is premised on the finding that Dr Gray and Dr Burton were, together with Dr Hodgkin and Dr McCulloch, joint inventors. 349 UWA had pleaded that either or both of Dr Gray and Dr Chen (not Dr Burton) developed or discovered the DOX-Spheres Invention during the course of their work at UWA and within the course of their employment. Dr Gray denied the allegations of invention in the course of employment and raised other challenges, such as the patentability of the claimed invention. While his Honour rejected Dr Chen as an inventor, he allowed that Dr Gray may have been an inventor, although, as we have previously noted, his Honour said that that was "debatable". As noted at [333] above, his Honour also concluded that the inventive concept was developed while Dr Gray was an employee of UWA. 350 This finding leads to the conclusion that Dr Gray's defence that the DOX-Spheres Invention was complete prior to his joining UWA failed. It does, however, allow the possibility of an entitlement in UWA in respect of the DOX-Spheres Invention through Dr Gray. This would be subject to the obstacles presented by (a) the fact that the DOX-Spheres PCT Application was not made by Dr Gray alone but by him and Dr Chen, and (b) his Honour's finding that the inventors were not Drs Gray and Chen, but Drs Gray (debatable), Burton, Hodgkin and McCulloch. 351 The primary Judge did not consider the matter further because of his "global rejection of the contract claims" (at [1562]). For the same reason, we will not consider the matter further. 352 As to Ground 27, French J did not fail to have any or any proper regard to the asserted matters. The DOX-Spheres Provisional Patent Application was referred to by his Honour at [677], [1272], [1278], [1300], [1330], [1334] and [1487]. Again, his Honour simply rejected UWA's problem/solution approach as his analysis at [1499]-[1503] shows. A similar observation applies to the DOX-Spheres PCT Application, which was referred to at [685], [733], [944], [1018], [1058], [1272]-[1274], [1278] and [1498]. Consistent with principle, French J rejected UWA's problem/solution approach (at [1500]-[1503], and see [313] above) but, in doing so, did not fail to give proper regard to the DOX-Spheres PCT Application. UWA's other assertion in Ground 27 of a failure to have regard to research and experimentation at UWA fails to grapple with his Honour's findings about the inventive concept of the DOX-Spheres Invention. 353 Ground 28 poses findings which it is said French J should have made and depends on an acceptance of Grounds 26 and 27 (as well as other grounds relating to the propounded implied terms and fiduciary duties). As those grounds have been rejected, Ground 28 must also be rejected.

H Grounds of Appeal 29, 30, 33 and 34: patents (specific) - Thermo-Spheres-1 INVENTION

Factual background to Grounds 29, 30, 33 and 34 354 On 12 September 1988, Dr Gray lodged with the Australian Patent Office, in his own name as applicant, a provisional patent application for an invention entitled "Targeted Hysteresis Hyperthermia as a Method for Treating Cancer". This was Provisional Patent Application No PJ0371 (at [466]). Dr Gray attached two appendices which were lodged with the provisional patent application. The first was entitled "Patent Application for Tumour Hyperthermia by Hysteresis Heating" and the second was a CSIRO feasibility study of 30 July 1988. 355 Dr Gray filed the same provisional patent application with the same appendices on 23 December 1994 (Provisional Patent Application No PN0213) and 10 May 1996 (Provisional Patent Application No PN9782) (at [471], [688], [870]-[872], [1272] and [1511]). Each was filed in the name of Dr Gray as applicant and named him as inventor. 356 Both the 1988 and 1994 provisional applications lapsed in the absence of the filing of a complete or PCT application. 357 The Thermo-Spheres-1 provisional applications of September 1988, December 1994 and May 1996 identified a new method "for delivering hyperthermia as a treatment for patients with cancer". The method was described (at [469]) as: incorporating magnetic materials into micro particles and injecting these particles into the environment of the tumour. Heat is generated from the particles by release of hysteresis heat when the micro-particles are placed in an alternating magnetic field. 358 Appendix 1 included information relating to the composition and use of microparticles in the treatment of cancer and the physics associated with hysteresis heating. Some of the information relating to the physics of hysteresis heating, including the appropriate ferromagnetic materials to be used and the methods of generating the necessary magnetic fields, had been supplied to Dr Gray by Professor Street in August 1987. 359 By the Deed of Assignment dated 1 May 1997 made between Dr Gray and Paragon Medical, Dr Gray assigned to Paragon Medical his rights in the Thermo-Spheres-1 Provisional Patent Application No PN9782 which he had filed on 10 May 1996. 360 On 9 May 1997, Paragon Medical filed a PCT Application No PCT/AU97/00287 entitled "Targeted Hysteresis Hyperthermia as a Method for Treating Diseased Tissue" (the Thermo-Spheres-1 PCT Application). Dr Stephen Jones and Dr Gray were named as inventors (at [1272], [1511] and [1516]).

Consideration of Grounds 29, 30, 33 and 34 361 UWA does not press Grounds 31, 32 and 35-41. In consequence, only one of the three Thermo-Spheres Inventions remains to be considered, namely, the Thermo-Spheres-1 Invention. 362 The primary Judge identified the inventive concept of Thermo-Spheres-1, having regard to the prior art, in accordance with Sirtex's submission, as the combination of three elements: (i) selecting a magnetic material with a magnetic heating efficiency (MHE) of at least about 4.5 x 10-8 J.m/A.g; (ii) when frequency is greater than 10kHz; and (iii) when magnetic field conditions are equal to or less than about 7.5 x 107 A/s (at [1533] and [1537]). 363 His Honour found further (also at [1533]) that none of these integers, let alone their combination, was disclosed in Provisional Patent Application No PN9782. In consequence, and consistent with Sirtex's submissions, French J found that the Thermo-Spheres-1 PCT Application was not fairly based on Provisional Patent Application No PN9782 from which it purported to claim priority. Hence, the priority date of the Thermo-Spheres-1 PCT Application could be no earlier than its own filing date of 9 May 1997. 364 The primary Judge then turned to the time when the Thermo-Spheres-1 inventive concept (as described at [362] above) was formed (at [1534]). His Honour accepted (at [1537]) that there was no evidence that it existed before April 1997. His Honour noted that Dr Stephen Jones had resigned from CACS on 22 January 1997 with effect from 31 January 1997. Importantly for present purposes, the latter date also marked his departure from UWA. On 22 January 1997, Dr Gray accepted Dr Stephen Jones's resignation from CACS and on 29 January 1997, the Vice-Chancellor accepted his resignation from the staff of UWA also effective from 31 January 1997. (At [505], his Honour said that in February 1997, Dr Stephen Jones was appointed as chief research scientist by CRI and served as such until 18 November 1998, commencing employment at Paragon Medical (now Sirtex) on 19 November 1998. At [1537], his Honour said that by April 1997, Dr Stephen Jones was an employee of old Paragon Medical). His Honour also stated, at [1537], that there was no evidence of Dr Gray's involvement in the conception of the defined MHE. It followed that the Thermo-Spheres-1 Invention was not developed in the period of Dr Stephen Jones's employment by UWA or in the course of Dr Gray's employment by UWA. 365 UWA's submissions on appeal centre on the complaint made in Ground 34 that French J wrongly focussed his attention on selected claims of the Thermo-Spheres-1 PCT Application and on the complaint that his Honour did not consider or make findings about the date when Dr Gray arrived at the invention disclosed in Provisional Patent Application No PN9782. 366 In identifying the inventive concept as we described it at [362] above, his Honour did not wrongly focus his attention on selected claims of the Thermo-Spheres-1 PCT Application. 367 As to the second complaint by UWA referred to above, as noted earlier his Honour concluded that the inventive concept of the Thermo-Spheres-1 Invention was not disclosed in Provisional Patent Application No PN9782 and did not exist before April 1997. As Dr Gray submitted, it is telling that UWA has not itself identified the inventive concept said to underlie Provisional Patent Application No PN9782 considered separately from the Thermo-Spheres-1 PCT Application. The reason for this is that UWA's case before French J depended on various solutions to problems (listed by his Honour at [1518]) being cross-referenced to the Thermo-Spheres-1 PCT Application. So much is plain from his Honour's reasons at [1518]-[1522]. 368 In other words, French J disposed of UWA's arguments in support of its claims by exposing a fallacy on which they depended. The fallacy was that the Thermo-Spheres-1 Invention was disclosed in the Thermo-Spheres-1 PCT Application which itself was fairly based on Provisional Patent Application No PN9782. However, his Honour found that the Thermo-Spheres-1 PCT Application was not fairly based on Provisional Patent Application No PN9782, and contained new integers in a previously unknown combination. Hence, the Thermo-Spheres-1 Invention was disclosed for the first time in the Thermo-Spheres-1 PCT Application filed on 9 May 1997, the inventive concept underlying which came into existence not before April 1997. 369 This finding was consistent with an exchange of faxes between Dr Stephen Jones and Mr Cox on 8 and 9 April 1997 and Dr Stephen Jones's evidence about the first use of the MHE formula, to which French J referred at [1535]. In these circumstances, for UWA to contend on appeal that his Honour should have found the date when Dr Gray conceptualised the invention disclosed in Provisional Patent Application No PN9782 is inconsistent with the case it ran at first instance. The contention also impermissibly seeks to circumvent his Honour's unchallenged finding that the Thermo-Spheres-1 PCT Application was not fairly based on Provisional Patent Application No PN9782 and involved an inventive concept residing in the combination of the three elements identified in [1533]. 370 For these reasons the submissions advanced in support of the appeal grounds relating to the Thermo-Spheres-1 Invention based on his Honour not making findings about the date when Dr Gray invented the invention disclosed in Provisional Patent Application No PN9782 are misconceived and are rejected. 371 The balance of UWA's submissions about the remaining appeal grounds in respect of the Thermo-Spheres-1 Invention suffer from similar problems. We deal with those submissions in so far as they can be dealt with independently of UWA's central complaint dismissed above. 372 UWA contends that Dr Gray did no work on hysteresis hyperthermia, as opposed to hyperthermia, before starting at UWA in 1985. But this is contrary to French J's finding at [1523] as follows: Dr Gray submitted that the concept of targeted hyperthermic hysteresis was a logical extension of his targeted microsphere technology. He also submitted, and I accept, that while in Melbourne he conceived and developed the concept of hysteresis hyperthermia with Dr Burton. Dr Burton, as indicated earlier in these reasons, had a particular interest in the use of hyperthermia. There was already a significant amount of published literature in existence in 1985 and 1986 to which reference has been made. [Emphasis added] 373 UWA's submissions disregard this finding of fact. UWA does not explain why this finding was in error. Instead, it simply asserts that it is somehow clear that Dr Gray invented hysteresis hyperthermia after arriving at UWA with the assistance of Professor Street. But all of the evidence on which it relies to support this assertion was considered by his Honour. 374 Similarly, UWA has not confronted the difficulty for its case created by French J's finding (at [1525]) that, before he came to UWA, Dr Gray was aware of the principles of hyperthermia; the possibility of embolising particulate magnetic particles within microspheres; the principles of hysteresis hyperthermia being generated by an electromagnetic field; and the potentiating effect of targeted hysteresis hyperthermia when combined with other treatment modalities. 375 UWA accepted his Honour's identification of the inventive concept of the Thermo-Spheres-1 Invention but disputed its timing. At one stage, UWA appeared to rely on unnamed staff and students at UWA practising the invention using materials with the claimed MHE feature under Dr Gray's supervision, even though these people might have remained unaware of the concept, but in oral submissions said that it did not rely on paragraphs of its written submissions that advanced that case. The submission would ignore French J's finding (at [1535]) that the inventive concept was "not conceived as a result of any particular experiment but following analysis of prior art to devise a new invention which lay beyond it". The suggestion that experiments by staff and students unaware of the inventive concept might have attained it and thereby vested ownership of it in UWA is unsupported. 376 For these reasons the remaining grounds (29, 30 and 33) should be rejected. Ground 29 repeats the unfounded complaint of an erroneous focus on selected claims of the relevant specification. Ground 30 asserts failure to consider other information, which it is plain that his Honour did consider. It also alleges a failure to consider research and experimentation done at UWA when in fact his Honour considered those matters but did not accept that they were anything more than mere verification. Ground 33 asserts that certain findings should have been made but those findings are dependent on the acceptance of UWA's earlier Grounds 29 and 30 (and other grounds concerning the propounded implied terms and fiduciary duties) and therefore must also fail.

I Grounds of Appeal 31 and 32 377 As noted at [13] above, these grounds were not pressed.

J Grounds of Appeal 35-41 378 As noted at [13] above, these grounds were not pressed.

K Ground of Appeal 42: Deed of Assignment of Intellectual Property Rights by Dr Gray to Sirtex (then called Paragon Medical Ltd) on or about 1 May 1997

L Ground of Appeal 43: UWA's entitlement to relief 379 As noted at [15] above, we need not address these grounds.

CONCLUSION 380 For the above reasons UWA's appeal should be dismissed with costs. Accordingly, it is not necessary that we consider Dr Gray's notice of contention. I certify that the preceding three hundred and eighty (380) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Lindgren, Finn and Bennett.

Counsel for the Appellant: Mr B J Hess SC and Dr L J Duncan

Counsel for the Respondent: Mr M L Bennett and Mr I R Freeman

Dates of Hearing: 10, 11, 12, 13 and 14 November 2008