Re Joseph Lazar v Taito (Australia) Pty Limited and Taito Corporation [1985] FCA 35; 5 FCR 395 (19 February 1985)

FEDERAL COURT OF AUSTRALIA

Re: JOSEPH LAZAR
And: TAITO (AUSTRALIA) PTY LIMITED AND TAITO CORPORATION
No. V G272 of 1984
Contempt of Court
5 FCR 395

COURT

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
Fox(1), McGregor(2) and Neaves(3) JJ.

CATCHWORDS

Contempt of court - Proceedings for infringement of copyright and breach of secns. 52 and 53 of Trade Practices Act 1974 - Interlocutory injunction - Whether non-compliance - Construction of injunction - Construction of statement of charge - Whether copyright an element of charge requiring proof - Whether finding of contempt vitiated by failure to prove copyright - Effect of course of proceedings before trial judge - Power to dispense with personal service under Order 1, rule 8 - Consideration of provision for an application to Court to reconsider committal on payment into Court of sum of money.

Trade Practices Act 1974

Contempt - Proceedings - Breach of injunction - Appeal against conviction - Failure to prove all allegations contained in the statement of charge - Matters to be included in a statement of charge in contempt proceedings - Dispensing with personal service - Federal Court Rules 1979, O. 1, r 8, O. 37, r 9, O. 40, rr 5, 6, 8, 12 - Trade Practices Act 1974 (Cth), ss 52, 53. An injunctive order had enjoined the appellant from, inter alia, selling specified amusement machines, infringing copyright therein and engaging in certain misleading or deceptive conduct. In an appeal against his conviction for contempt arising out of his having sold certain machinery, the appellant argued that the trial had miscarried, on the basis that even if those sales had been proven, this was not sufficient to establish the contempts, as the terms of the allegations in the statement of charge required also proof of the copyright and trade practices matters.

Held: (1) Per Fox and McGregor JJ; Neaves J. dissenting - Failure to prove the additional copyright and trade practices matters which were referred to in the statement of charge did not entitle the appellant to succeed. Per McGregor J. - It is not necessary to prove every assertion express or implied in a statement of charge alleging breach of an injunction, but only those ingredients which are essential. Such a statement must contain allegations which are within the terms of the injunction. Per Fox J. The statement should indicate the injunction relied upon and give brief particulars as was done here. Per Fox and McGregor JJ - It was relevant too, that at the trial neither party nor the trial judge had referred to or required proof of such additional matters and that the argument that such proof was necessary was outside the grounds of appeal.

Re Bramblevale Ltd (1970) Ch 128; Comet Products UK Ltd v. Hawkex Plastics Ltd (1971) 2 QB 67; Knight v. Clifton (1971) 1 Ch 700; Clifford v. Middleton (1974) VR 737; Foley v. Herald-Sun TV Pty Ltd (1981) VR 315; Rigoli v. Gozzi (1981) ACLD 376; Ex parte Pritchard (1918) 18 SR (NSW) 434; 35 WN 129; Ex parte Ferguson; Re Alexander (1944) 45 SR (NSW) 64; 62 WN 15, referred to.

(2) Per curiam - The court's discretionary power under O 1, r 8 of the Federal Court Rules 1979 to dispense with personal service could be exercised in a case such as this, even though to do so would override O 40, r 8 of those rules ( per McGregor J) particularly where there is no apparent injustice, although (per Neaves J) there will be limited circumstances in contempt proceedings in which the discretion should be exercised.

(3) The application for an order for payment of money into court, being civil in nature should not have been joined with the contempt proceedings, being criminal in nature, but in this case the proceedings did not thereby miscarry.

Australian Building Construction Employees' and Builders' Labourers' Federation v Viner (Minister for Industrial Relations) (1982) 63 FLR 253; 2 IR 53, Re Cohen; Ex parte Trustee (1924) 2 Ch 515, referred to.

HEARING

Melbourne, 1984, December 10, 11, 12; 1985, February 19. 19:2:1985
APPEAL

Appeal from a decision of Smithers J. committing the appellant to prison for contempt of court.

J. S. Winneke QC and R. C. Gillard, for the appellant.

A. C. Chernov QC and J. W. K. Burnside, for the respondents.
Cur adv vult

Solicitors for the appellant: Mercer Lewenberg & Pryles.

Solicitors for the respondents: Coady Dwyer & Associates.
GFV

ORDER

1. The appeal be dismissed.

2. The appellant pay the respondent's costs of the appeal.

3. The proceedings be remitted to the learned judge to make such orders as may be necessary to effect execution of the order for commitment made by him.

Appeal dismissed with costs

DECISION

The facts in this matter, and relevant legal provisions, are set out in the reasons for judgment of Neaves J. and I shall only repeat those necessary to explain these reasons. I agree in general with the judgments of McGregor J. and of Neaves J., save that I have reached a different conclusion from that of Neaves J. on the question whether a case was made out respecting the five computerised amusement machines referred to in para. 4 of the Statement of Charge, which was filed with the Notice of Motion of 16 August 1984. It was this statement of charge which was amended during the course of the proceedings before Smithers J. I am of the view that contempt was established on both this charge and that respecting the two machines. The procedure, requiring a notice of motion and statement of charge is prescribed by rules 5 and 6 of Order 40 of the rules of Court.

The original application, dated 2 July 1984, relied upon ss. 52 and 53 of the Trade Practices Act 1974 as well as ownership of copyright. An affidavit in support, which is not in the papers, deals with copyright in the computer programme, in the TX-1 logo, and in drawings on the cabinet. There is an oblique reference to copyright being in the programme, when Mr. Goodsell, in his affidavit, which is in the papers, recites what was said to him by the present appellant concerning the Apple computer and the action against Computer Edge. An appeal in the Apple matter was heard by the Full Court of this Court, and a further appeal is now pending before the High Court. The statement of claim was filed on 31 July 1984 and alleges copyright in the "source and/or object code" of computer programmes contained in the TX-1 machine, and in "artistic works being the cockpit and console of the TX-1".

There is nothing to suggest that when the original injunctions issued, the one which is now primarily under consideration, relating to selling, etc. was based simply upon infringement of copyright. The first two injunctions ordered, which I now set out for clarity, followed the pattern (and with some changes in sub-para. (i), the language) of the injunctions sought in the application:

"(2) The following interlocutory injunctions go until the hearing and determination of the Application or until further order restraining the Respondents whether by themselves their servants or agents or howsoever from -

(i) selling, hiring out or encumbering amusement machines of the kind known as "TX-1" and bearing the insignia thereon "TX-1" and the name "Tazmi";

(ii) infringing the Applicants' copyrights in the said amusement machines;".

It is of course of very little use, if any, to obtain an interlocutory injunction in copyright proceedings, which simply restrains infringement of copyright. That course can also be unfair to the respondent and the source of confusion. The effective part of the injunctions mentioned was that dealing, separately, with specific action. There was an injunction simply to restrain infringement of copyright, and this could add weight to the argument that proof of copyright was necessary in the hearing for contempt, so far as concerned the five machines.

The relevant statement of charge, which was filed with the notice of motion of 16 August 1984, contains in paragraph 4 a clumsy blend of the particular and the general:

"(4) On various dates between 12th July, 1984 and 30th July, 1984 the Respondents, acting through the Secondnamed Respondent, sold five TX-1 machines and thereby infringed the Applicants copyright and engaged in conduct which was misleading and deceptive and so acted in contempt of the Orders aforesaid."

I would read the general language, from the words "and thereby" to, and including, "deceptive" as explanatory, or emphatic, of the bases upon which it was claimed the injunction numbered (2)(i) was obtained. The following words in the charge refer back to the acts, as being the matter which constitutes contempt. I do not think that anyone did or could contemplate that proof of the charge involved proof of copyright, or of a breach of s.52, or the relevant provisions of s.53 of the Trade Practices Act.

Paragraph 4 of the statement of charge was amended during the course of the hearing to read:

"4. . . .

(a) On various dates between 12th July 1984 and 30th July 1984 the

first named Respondent acting through the secondnamed Respondent sold 5 TX-1 machines to Moreland Finance Pty. Ltd., alternatively sold the said 5 machines to the thirdnamed Respondent.

(b) Alternatively on 14th July 1984 alternatively 23rd July 1984, the secondnamed Respondent sold the said 5 machines to Moreland Finance Pty. Ltd. on behalf of the thirdnamed Respondent.

(c) By his participation in the sales aforesaid, the secondnamed respondent sold the said 5 machines.

(d) By reason of the said sales the Respondents infringed the Applicants' copyright and engaged in conduct which was misleading and deceptive and so acted in contempt of the orders recited in paragraphs 1, 2 and 3 hereof."

This amendment provided alternatives, and greater particularisation. Paragraph (d) rather follows the pattern set by the similar words in the original charge. I am unable to read the words in that paragraph concerning infringement of copyright and misleading and deceptive conduct as qualifying what is asserted in paras. (a), (b) and (c). The following words "and so acted . . .", prima facie refer back to the acts referred to in the earlier paragraphs. It may be correct to regard the words as surplusage, but I think they were intended to have a purpose, which is to explain the basis upon which the applicant claims relief. There always have been averments which are not traversible, and parts of indictments are often merely emphatic or explanatory.

What is clear is that the parties and the judge did not regard the words in question as requiring proof of copyright (or of misleading or deceptive conduct). Such a requirement would have made a nonsense of the whole proceedings. Moreover, to regard one of the charges as requiring proof of copyright in, or in connection with the machines, while the other charge did not, would have seemed to the parties to be strange at least, and to have invited comment, and submissions. Counsel for Mr Lazar argued before the trial judge submissions that there was no case to answer and against allowance of the amendment, but no reference was made then or at any time to the need for proof of the matters mentioned, or any of them. The first time the argument was raised was before us, and even then it went outside the grounds of appeal. Indeed, para. 3 of the Notice of Appeal, which deals with charge 4, relating to the five machines, paraphrases the charge by referring simply to sale.

I have so far dealt with the content of the charges, as if they are, solely, the essence of the matter. The fact is, however, that what is charged is contempt of court in not complying with the relevant injunctions. The charges operate to indicate the injunction (or injunctions) relied upon, and to give brief particulars. The analogy between the charge required by the rules of Court and a criminal charge is incomplete, because the person to whom an injunction is directed knows, with some precision, and specificity, what he is commanded not to do.

I am therefore of the view that both convictions should stand.

On the matter of penalty, I agree with what has been said by Neaves J. A case has not been made out to vary the sentence of three months imprisonment, even if only one charge were established. Injunctions are a very common and very important element in civil proceedings, and it is in my view quite vital that there be ready and strong sanctions for their enforcement. It is not the dignity of the Court which is in question, but the due administration and enforcement of the law.

I mention, without thereby meaning to make any suggestion, or to indicate that my view of the sentence has been affected thereby, that under the rules (Order 40, rule 12) application can be made to the judge at any time, with appropriate evidence, for earlier release. I do not want to add anything to what has been said by McGregor J. and Neaves J. concerning the part of his Honour's order dealing with payment into Court of the proceeds of sale.

There is a further matter, to which I made passing reference in the course of argument. The formal order should, I believe, have stated that the respondent (appellant before us) had been found guilty, and of what he had been found guilty. If this exercise had been undertaken, some at least of the argument before us might have been unnecessary. Conceivably the whole of the principal question I have been considering could have been resolved by the trial judge. A form of warrant of committal is in the schedule to the rules (form 49) and is there attributed to 0.37, r.9. I have looked at a copy of the warrant which was issued. It was signed by Smithers J., and it says that Mr. Lazar's committal is for contempt of court, and sets out particulars of the sale of the five machines as well as of two machines, in each case in contravention of the injunction of Sweeney J. of 4 July 1984. No reference is made to infringement of copyright, or breach of the Trade Practices Act.

In the circumstances, and in the absence of any submission on the matter, I do not propose that this Court make an order that some course be adopted in relation to the content of the formal order which was made.

I would dismiss the appeal, with costs.

It appears that by a sequence of two orders execution of the warrant of committal has been stayed awaiting the outcome of this appeal. The operative portion of the warrant reads:

"Receive JOSEPH LAZAR into your custody and keep him there until the expiration of three calendar months from the date on which he is so received into your custody."

The period of three months has not started to run. I have not seen the orders staying execution, and understand that the latest has not been formally taken out, but it may now be necessary to make an order lifting the stay. This matter and appropriate orders to ensure execution of his Honour's judgment are best left to be dealt with by him, and for that purpose the contempt proceedings should now be remitted to him.

I have had the benefit of reading in draft the facts set out in the Reasons for Judgment of Neaves J. who also refers to the parties in the hearing at first instance. It is not necessary to re-state these matters here except insofar as dealing with a particular submission may require.

It is convenient to deal with the arguments presented by senior counsel for the appellant which were, as he told us, in effect, summarised in the Amended Notice of Appeal which was by leave filed in Court on 10 December 1984. The arguments were not always addressed to the grounds in the order these are numbered.

Counsel referred to the Notice of Motion dated 16 August 1984 to which the first eight grounds of appeal set out in the Amended Notice of Appeal relate. He argued the grounds in paras. 1, 2 and 3 thereof together. He submitted that what he described as "procedural contempts" were of the nature of criminal contempts requiring strict proof on the criminal standard and a rigid adherence to the Court's rules and procedures. In support of this proposition he referred to In re Bramblevale Ltd. (1970) Ch. 128; Comet Products v. Hawkex Plastics (1971) 2 Q.B. 67 (Comet); Knight v. Clifton (1971) 1 Ch.700; Clifford v. Middleton (1974) V.R. 737; Foley v. Herald-Sun T.V. Pty. Ltd. (1981) V.R. 315; Rigoli v. Gozzi (1981) A.C.L.D. 376. As a more general contention counsel argued that the learned primary Judge failed to apply a standard of proof of a sufficiently high degree. The criticism that his Honour indicated that he was applying such a standard but "did not abide by it" is answered by the terms of the ultimate finding couched in the formula of "beyond reasonable doubt".

Counsel submitted that the charge set out in para.4 (reproduced in the Statement of Reasons of Neaves J.) of the statement of charge filed with the Notice of Motion dated 16 August 1984 was too wide and ambiguous; that accordingly, the learned primary Judge was unable to, and did not, make findings in support of it. These submissions, he said, applied to the charge both as originally laid and as amended. He contended that it was for an applicant to frame the charges upon which he asks the Court to commit a person to prison; here the charge particularized in para. 4 had a number of ingredients requiring strict proof. In his submission, it had to be proven, firstly, that Eastern Micro Electronics Pty. Limited (to which I will refer as EME or Eastern accepting for present purposes the nomenclature of the primary Judge and Neaves J.), acting through the appellant, sold 5 "TX-1" machines; secondly, that by doing so, they infringed the respondents' copyright; and, thirdly, that by doing so, they engaged in conduct which was misleading and deceptive, and so acted in contempt of the Court order as aforesaid. He argued, in effect, that the charge set out in para. 4 could not be equated with one that "on various dates" the appellant sold the 5 machines and so acted in contempt of the Court order, thus obviating the need to prove copyright infringement and misleading or deceptive conduct.

However, though I have not attempted to set out counsel's argument fully, I do not accept this submission. The learned primary Judge had allowed an amendment of para. 4 of the statement of charge which was then expressed in sub-paragraphs (a) to (d), the first three of which described the machines as "5 TX-1" or "the said 5 machines". The allegation in sub-paragraph (a) was that EME or Eastern acting through the appellant sold the five machines to Moreland Finance Pty. Ltd. or to Mazz Enterprises (Australia) Pty. Limited (Mazz); in sub-paragraph (b) that the appellant sold the machines to Moreland Finance Pty. Ltd. on behalf of Mazz; in sub-paragraph (c) that by his participation in the sales aforesaid the appellant sold the machines.

It is not necessary to prove every assertion expressed or implicit in a charge; but only those ingredients which are essential to it. A failure to prove inessential material does not result in the charge failing; (cf. Ex parte Pritchard 18 S.R. (N.S.W.) 434 per Cullen C.J. at p.436; Ex parte Ferguson; Re Alexander 45 S.R. (N.S.W.) 64 per Jordan C.J. at p. 68). Sub-paragraph (d) (one of the sub-paragraphs into which para. 4 was divided) contains assertions that I consider inessential to the charge in that paragraph. This view gains some support from the absence of any assertions similar to those in sub-paragraph (d) in the three charges set out in paras. 5, 6 and 7. These paragraphs, which separately deal with three different machines, each allege that the appellant parted with the power, possession, custody and control of a particular machine (identified by a serial number) by installing it in certain premises (paras. 5 and 6) or releasing it into the possession of Ian Sykes (para. 7). In my view, the first three sub-paragraphs of para. 4 and paras. 5, 6 and 7 allege a sale or parting with possession of the five machines, and sub-paragraph (d) of para. 4 is merely a summary of the effect of the three preceding sub-paragraphs. Even if sub-paragraph (d) of para. 4 is essential to the charge set out there, then it is implicit in the injunctive order that for the purposes of that order it was assumed or accepted that copyright infringement or misleading or deceptive conduct was (or could be) a corollary of sale or parting with possession etc. The object of the injunction clearly was to ensure, as far as the Court could by its order, that the machines did not leave the power, possession, custody or control of the appellant until the issues in the case, including issues as to copyright and misleading or deceptive conduct, could be resolved. This object would be frustrated if a breach of the injunction, amounting to contempt, could not be established until a determination of these very issues. From argument, a perusal of the transcript and the Reasons of the learned primary Judge, it is clear that the matter was not conducted on any other basis than it was sale or parting with possession that had been prevented until the main issues (e.g. breach of copyright) could be determined. Consistent with this, his Honour expressed himself as satisfied beyond reasonable doubt as to the central issue in the interlocutory proceedings, i.e. that the appellant engaged in the conduct referred to, viz. sale or parting with power or possession (putting it shortly) of the machines; as his Honour said -

". . . . thereby to frustrate the purpose of the order restraining him and EME from selling or parting with the machines. He thereby engaged in conduct forbidden by the order and was guilty of contempt."

His Honour went on to refer the contempt to the conduct of the appellant and EME or Eastern relating to the sale of two machines (second Notice of Motion) to Mr. Sykes on 7 July 1984 and the conduct of the appellant and EME or Eastern relating to the sale of the 5 machines.

In my opinion it is clear that the charges made appropriate allegations which were within the terms of the injunction, and the matter proceeded upon the basis that it was the allegations of sale or parting with possession which were to be proved. His Honour's findings were thus responsive to those allegations. Accordingly, it was of no moment that there was no evidence to that stage in the proceedings as to breach of copyright or misleading or deceptive conduct. It is worth noting that such a contention as has been argued before us was not taken in the original Notice of Appeal with its 56 grounds. Senior counsel for the appellant agreed in argument that before the learned primary Judge no submission was made as to breach of copyright or misleading conduct and that the construction of para. 4 of the statement of charge that he now sought to put forward was different from that taken in the Court of first instance; there the issue of copyright "did not arise in anybody's mind".

In my view, grounds 1, 2 and 3 have not been made out.

In relation to ground 6(a) of the Amended Notice of Appeal counsel argued, in effect, that the charge in para. 4 in the statement of charge filed with the Notice of Motion dated 16 August 1984 should have succeeded only upon the Court's finding that the machines sold were of the kind referred to in the injunction order. But, in counsel's submission, there was no evidence upon which the Court could so find. The machines were identified as follows in the interlocutory injunction (para. 2) granted by Sweeney J. on 4 July 1984 -

". . . . amusement machines of the kind known as 'TX-1' and bearing the insignia thereon 'TX-1' and the name 'Tazmi'."

In my view the machines dealt with by the appellant were sufficiently identified as being of the kind referred to in the injunction order. First of all, a perusal of the evidence, including the evidence in Mr. Lazar's affidavit of 13 July 1984, indicates that the issues raised did not include any contention that the machines so dealt with by the appellant were other than the ones the subject of the injunction and charge; and if such a contention had been raised, it was adequately met by the material in the appellant's said affidavit. This, in effect, took the form of confession and avoidance, or offered matters as to why his conduct might be thought to be excusable, rather than raising any contest as to identification. It was also contended in ground 7 of the Amended Notice of Appeal that the learned primary Judge was not entitled to permit the admission or introduction into evidence of the material in that affidavit. Yet we have been referred to passages in the transcript where both sides did draw attention to the contents of the affidavit. Furthermore, in my opinion, whether as an affidavit or not, it constituted a statement in writing over the hand of the appellant and thus was capable of being accepted as an admission (cf. per Cross L.J. in Comet at p. 77). The weight of any such admission was increased because it was verified. I observe, however, that it is not necessary to discuss weight in connection with a no evidence point. It was not suggested before the learned primary Judge that it had not been shown it was the document of the appellant; nor, in my view, could any such contention have been advanced, having regard to the place of the document on the file, its contents, the description of it adopted by the original grounds of appeal filed in this matter, the fact that it was actually read before Sweeney J., and, if that were not sufficient, the reference to it by the appellant's then counsel in argument to the learned primary Judge. I accept the submission that it was then common ground that the charges referred to the same machines as the injunction order; and they were the machines which had been dealt with by the appellant. Further, in my view, contrary to ground 6(b) of the Amended Notice of Appeal, the evidence was capable of supporting the inference that the sales had been by EME or Eastern or, alternatively, by Mazz acting as agent for EME or Eastern. The appellant did not choose himself to give evidence to the contrary, though it would appear he was, more than anyone else, in a position to contravert such a contention. So the learned primary Judge, assisted by the absence of such evidence, was enabled the more readily to draw an inference adverse to the appellant.

I should add that counsel for the respondents, in meeting the argument as to the entitlement of the primary Judge to refer to the affidavit, referred to In re Cohen. Ex parte Trustee (1924) 2 Ch. 515 (Re Cohen). He relied on a submission that there Lawrence J. by reason of the practice of the Chancery Court had allowed reference by the respondents to an affidavit filed but not read. However, the Court of Appeal (which overruled Lawrence J. on the preliminary point of practice) took the view, for reasons set out, that the practice of the Bankruptcy Court was against permitting reliance on such an affidavit until read. Pollock M.R. said at pp. 525-526 -

"It is clear therefore that a respondent may take the objection that the applicant has not established his claim on the motion, and, if that objection is allowed, that the respondent is not compelled to allow his evidence to be read."

Nevertheless, Re Cohen, upon examination does not, I suggest, advance the appellant's case. Although one pays respect to the way matters of bankruptcy are administered by, and the procedures in, the Courts of the United Kingdom, we are not bound by them. Further, this was not the use of an affidavit as such, but of a statement in writing signed by the appellant containing admissions. Moreover, when the second Notice of Motion was called on and his Honour made an order that the motions could be heard together, the affidavit of 13 July 1984 was again referred to and was one of a number of documents marked without objection as an exhibit. This is consistent with its being used otherwise than as an affidavit. Re Cohen, though apparently not supporting the argument of respondents' counsel, is distinguishable.

Senior counsel for the appellant said these proceedings could not have been treated as civil proceedings; they were proceedings of a criminal nature; therefore the charges had to be proved with strictness. No one disputes this, although the proceedings were, in fact, for civil contempt. See per Lord Denning M.R. in Comet at p. 73. Yet it is commonplace in criminal cases that the accused's own signed documents are tendered against him.

Grounds 6 and 7, in my opinion, have not been made out.

Ground 4 of the Amended Notice of Appeal states that the primary Judge was in error in allowing amendment of the statement of charge filed with the first Notice of Motion whereby the original para. 4 became divided into four separate sub-paragraphs. It is sufficient to say that amendments may and frequently are allowed late in all manner of proceedings. An exercise of discretion is involved. In particular, there should be no such amendment if a party is thereby unfairly prejudiced so that e.g. some allegation is permitted when he can no longer answer it. It is clear that the amendments made raised no new matter and that his Honour was well aware of the necessity to avoid any unfairness to the appellant. No error in the exercise of his discretion has been demonstrated.

In my opinion there is no substance in ground 4.

Ground 5 contends that the learned primary Judge erred "in allowing a motion in the form of an application for civil relief" (i.e. the requirement of lodgment of monies received in respect of the sale or hire of the machines) in conjunction with one seeking punishment for contempt. I have noted what was said in Australian Building Construction Employees' and Builders Labourers' Federation v. Minister of State for Industrial Relations 43 ALR 189. His Honour made no order as to payment into Court. I do not accept that by dealing with those portions of the two Notices of Motion in the sense of hearing evidence or argument on them his Honour was in error; or that there is any indication that thereby he became prejudiced, as is claimed, against the appellant. For his Honour to hold that the appellant was in contempt of court it was sufficient for him to rely on his finding that there was a purported sale. This proposition in substance was not really disputed finally before the learned primary Judge, though it was sought to argue that the appellant was not the seller.

In my view there is no substance in ground 5.

The material raised in respect of the second Notice of Motion (relating to 2 machines) dated 6 September 1984 may now be considered.

Grounds 10 and 11 of the Amended Notice of Appeal raised the issue of personal service of the (second) Notice of Motion filed on 19 September 1984 and affidavit material in support thereof. The relevant documents were, on 19 September 1984, served on the appellant's solicitors; who did not, so far as we have been told, refuse to accept them or disclaim any instruction to receive them or accept service. The first Notice of Motion on 16 August 1984 had been filed and served on the appellant; and for one reason or another this whole matter had been before the Court on two occasions, viz. 27 August 1984 and 29 August 1984, prior to the service of the second Notice of Motion, i.e. on 19 September 1984. Counsel, as I have understood him, did not finally contend that his Honour did not have power pursuant to Order 1 Rule 8 to dispense with compliance with Order 40 Rule 8; but only that such a dispensation should rarely be given and only where it is impossible to effect personal service. In my opinion there was power in Order 1 Rule 8 to have dispensed with personal service. Such a power may be exercised particularly, I suggest, where there is no apparent injustice and the alleged error can only be one of procedure. The learned primary Judge was entitled in the circumstances of this case, in his discretion, to dispense with personal service.

In my opinion grounds 10 and 11 do not provide any defence here.

Ground 12 is the same as ground 5 and has already been discussed. I need say nothing more about it.

Counsel put forward an argument as relevant to both Notices of Motion but offered in support of ground 13 in particular. He referred to that part of the enjoining order dated 4 July 1984 which included -

"parting with power, possession, custody . . . . of the said amusement machines or any component or parts therefor embodying any reproduction of any substantial part of the computer programme contained within the main control panel of the said amusement machines . . . ."

In his submission, properly interpreted, the order was really restraining the appellant from parting with possession etc. of a machine embodying the computer program that the respondents were seeking to protect. He argued that a statement of charge which simply alleged that the appellant breached the Court's order by parting with possession of the machines did not truly reflect the Court's order as properly interpreted. It was necessary, he argued, to allege not only parting with possession of, and power over, machines, but to allege this in respect of machines which contained or "embodied" a reproduction of a substantial part of the computer program. Thus, in his submission, there was a basis for, as he put it, demurring to the charges set out in paras. 5, 6 and 7 (of the first Notice of Motion) and charges set out in paras. 4 and 5 of the second Notice of Motion. Counsel submitted there was no proof that the machines with which there was a parting with possession etc. were machines which embodied the computer program of the type described in the order.

However, the statement of charge filed with the Notice of Motion dated 16 August 1984 (5 machines) and the second statement of charge filed with the Notice of Motion dated 6 September 1984 (2 machines) in my view sufficiently identify the machines as being of the same kind, at least, as that referred to in the injunction which is reproduced in the Notices of Motion. I note that in the charges set out in paras. 3, 4 and 5 in the second Notice of Motion, the word "said" precedes the word "machines" and thus relates the subject matter of the charges to that of the injunction. No submission was made to the primary Judge that there was any lack of identity between the machines the subject of the injunction, the machines dealt with by the appellant, and those in respect of which charges were brought. It is apparent from his affidavit of 13 July 1984 discussed above that the appellant had no doubt as to the identity of the five machines referred to; and the agreement for sale dated 11 July 1984 between Smith and Sykes is for five machines. We were not referred to any evidence nor offered any argument as to the capacity of these machines acting in their role of amusement machines to operate with a variety of programs; or as to whether there is but one program which is integral to the machine. Perhaps the appellant could have given such information; or raised such an issue thus allowing it to be debated before the learned primary Judge. He chose not to give such evidence. His counsel raised no such issue at that stage. Even a parting with possession etc. of machines not embodying the computer program might have been sufficient to constitute a breach of the injunction.

In my view the argument as to embodiment must be rejected. Ground 13 fails.

Ground 14 relies on a failure by the respondents to prove that the machines were of the kind described in the Court's injunction order. The order identifies the kind of machines as that known as "'TX-1' and bearing the insignia thereof 'TX-1' and the name 'Tazmi'". The ground is similar to ground 6(a). It is not necessary to traverse the arguments used in support of it. In my opinion there is no substance in the appellant's contention.

Ground 14 has not been sustained.

Senior counsel for the appellant submitted also that the term of commitment, viz. three months, was excessive (see grounds 8 and 15). I have read the Reasons in that regard in the draft prepared by Neaves J. with which I respectfully agree; and I do not wish to add anything.

I would dismiss the appeal with costs.

I have had the advantage of reading the order proposed by the learned presiding Judge and agree with it.

This is an appeal by Joseph Lazar ("the appellant") from a decision of the Court constituted by a single Judge (Smithers J.) committing the appellant to prison for three months for contempt of court. The contempt consisted in the appellant wilfully engaging on 7 and 14 July 1984 in conduct which was forbidden by an order of the Court made on 4 July 1984 in proceedings between Taito (Australia) Pty. Limited and Taito Corporation as applicants and Eastern Micro Electronics Pty. Limited and the appellant as respectively the first and second named respondents. To those proceedings Mazz Enterprises (Australia) Pty. Limited was joined as the third named respondent but this did not occur until 18 July 1984, that is to say, after the conduct constituting the contempt.

In order to understand the questions which arise for decision on this appeal it is necessary to trace in some detail the history of the matter.

On 2 July 1984 proceedings were commenced in this Court by Taito (Australia) Pty. Limited and Taito Corporation ("the applicants") against Eastern Micro Electronics Pty. Limited ("Eastern") and the appellant seeking declarations and injunctions in respect of conduct that was said to be in breach of section 53 of the Trade Practices Act 1974 or to be misleading or deceptive or to be likely to mislead or deceive contrary to sub-section 52(1) of that Act and that was alleged to amount to the infringement of the applicants' copyrights in certain amusement machines described as machines of the kind known as "TX-1" and bearing thereon the insignia "TX-1" and the name "Tazmi".

A convenient description of the machines is given in the reasons for judgment of Smithers J. in the following terms -

"The machines in question are computerised amusement machines. The predominant commercial use of those machines in the hands of their owners was to locate them in amusement parlours, milk bars or other places where people congregate so that they are available to those attending such establishments for the playing of games. The players place coins being the fee for playing into a set in the machine. From time to time the owner of the machine collects from the machines the proceeds from the playing of the machine and they are shared between the owner of the machine and the proprietor of the amusement establishment."

The applicants applied for interlocutory relief and on 4 July 1984 Sweeney J. made a number of orders. For present purposes it is sufficient to set out orders 2 and 3. Those orders read -

"2. The following interlocutory injunctions go until the hearing and determination of the Application or until further Order restraining the Respondents whether by themselves their servants or agents or howsoever from -

(i) selling, hiring out or encumbering amusement machines of the kind known as 'TX-1' and bearing the insignia thereon 'TX-1' and the name 'Tazmi';

(ii) infringing the Applicant's (sic) copyrights in the said amusement machines;

(iii) engaging in conduct which is misleading or deceptive or likely to mislead or deceive any person by inducing or creating a belief that the firstnamed Respondent is the only person importing or entitled to import the said amusement machines into Australia or the only person importing or entitled to import the said amusement machines into Victoria;

(iv) engaging in conduct which is misleading or deceptive or likely to mislead or deceive any person by inducing or creating a belief that the firstnamed Respondent is entitled to sell, let on hire or by way of trade offer or expose for sale or hire or by way of trade exhibit in public the said amusement machines.

3. The following interlocutory injunctions go until the hearing and determination of the Application or until further Order restraining the Respondents whether by themselves their servants or agents or howsoever from -

(i) parting with power, possession, custody or control (otherwise than to the Applicants) of the said amusement machines or any component or parts therefor, embodying any reproduction of any substantial part of the computer programme contained within the main control panel of the said amusement machines and any documentation designed for use with any such reproduction;

(ii) selling, disposing of, destroying, altering or concealing any such item as is referred to in sub-paragraph (i) above;

(iii) parting with power, possession, custody or control (otherwise than to the Applicants) or hiding, defacing, altering or destroying any documents (which expression in this Order includes records in magnetic or other computer readable form) relating to the importation, acquisition, distribution, sale or hire or any such item above referred to."

The references to the respondents are references to Eastern and the appellant. The reference to the first named respondent is to Eastern.

A copy of the order made on 4 July 1984 endorsed with a notice as required by Order 37, rule 2 of the Federal Court Rules was served personally on the appellant on 5 July 1984.

The matter again came before Sweeney J. on 13 July 1984 on motions of the applicants on the one hand and Eastern and the appellant on the other to vary the orders made on 4 July 1984. Those orders were varied in respects which are not material for present purposes and the motions were adjourned until 18 July 1984. It is, however, material that, in support of the motion of Eastern and the appellant, reliance was placed upon an affidavit sworn by the appellant on 13 July 1984. It will be necessary to refer to that affidavit later in these reasons.

On 18 July 1984 the matter came before Woodward J. The motion of Eastern and the appellant was dismissed. Upon the motion of the applicants an order was made joining Mazz Enterprises (Australia) Pty. Limited ("Mazz") as the third named respondent and interlocutory injunctions were granted restraining Mazz in similar terms to the injunctions granted by Sweeney J. on 4 July 1984. The matter was adjourned until 26 July 1984 to enable the applicants to file and serve any further affidavits as they might be advised.

The matter again came before Woodward J. on 26 July 1984. His Honour, by consent, granted further interlocutory injunctions in terms which embody the terms of the injunctions granted on 4 and 18 July 1984 and gave directions in relation to the substantive application. Certain further orders were made to which it is unnecessary to refer.

On 31 July 1984 the applicants filed a statement of claim in the proceedings.

On 16 August 1984 the applicants gave notice that they would on 27 August 1984 move the Court for an order that the appellant be punished for the contempt referred to in an annexed statement of charge also dated 16 August 1984. That statement, after referring to the orders made on 4, 18 and 26 July 1984, set out in paragraphs 4 - 7 inclusive the alleged contempts in the following terms -

"4. On various dates between 12th July, 1984 and 30th July, 1984 the Respondent(s), acting through the Secondnamed Respondent, sold five TX-1 machines and thereby infringed the Applicants' copyright and engaged in conduct which was misleading and deceptive and so acted in contempt of the Orders aforesaid.

5. On or about the 14th July, 1984 the Secondnamed Respondent parted with power possession custody and control of one of the said amusement machines, bearing serial number 408532, by installing it at premises at 163 Sladen Street, Cranbourne.

6. On or about the 25th July, 1984 the Secondnamed Respondent parted with power possession custody and control of one of the said amusement machines bearing serial number 408625 by installing it at premises at 22 Glengala Road, West Sunshine.

7. On or about the 24th July, 1984 the Secondnamed Respondent parted with power possession custody and control of one of the said amusement machines bearing serial number 408533 by releasing the same into the possession of Ian Sykes for installation at premises at 15 Buckingham Avenue, Springvale."

The reference which was originally made in paragraph 4 to "the Respondent" was subsequently amended by order of the Court to read "the Respondents" and it is common ground between the parties that that expression refers to Eastern and Mazz. The references to "the Secondnamed Respondent" are to the present appellant. It is also common ground that the serial number of the machine referred to in paragraph 6 is incorrect, the correct serial number being 408523. The notice of motion also sought an order in the following terms -

"That the Respondents within 24 hours lodge with the Court, pending the hearing and determination of the Application, any moneys received by them in respect of the sale or hire of the said amusement machines."

The notice of motion dated 16 August 1984, the statement of charge of that date and the affidavits in support, being the affidavits of James Armel Goodsell, the Victorian State Manager of Taito (Australia) Pty. Limited, sworn respectively 2 July 1984, 18 July 1984, 26 July 1984 and 16 August 1984 were served personally on the appellant on 20 August 1984.

The hearing of the motion commenced on 27 August 1984 and was adjourned to 30 August 1984. However, on 29 August 1984 the applicants filed an affidavit sworn on that day by one Ian Sykes. That affidavit, apart from referring to the transaction concerning the five machines referred to in paragraph 4 of the statement of charge above referred to, referred to an earlier transaction concerning two such machines. Upon the applicants stating that they wished to bring further proceedings for contempt in respect of the earlier transaction the motion before the Court was adjourned to a date to be fixed. The date subsequently fixed was 21 September 1984.

On 6 September 1984 the applicants lodged at the registry of the Court a notice of motion bearing that date in which the applicants sought an order that the appellant be punished for the contempts referred to in an annexed statement of charge also dated 6 September 1984. That statement, after referring to the orders made on 4 and 18 July 1984, set out in paragraphs 3 - 6 inclusive the alleged contempts as follows -

"3. On or about 7th July, 1984 the Firstnamed Respondent through the Secondnamed Respondent sold two of the said machines bearing serial numbers 407621 and 407520.

4. On or about 7th July, 1984 the Firstnamed Respondent through the Secondnamed Respondent parted with power possession or control over the said two machines, by agreeing to sell them as aforesaid.

5. On or about the 28th July, 1984 the Firstnamed Respondent through the Secondnamed Respondent accepted further payment for the said two machines in the sum of $20,500.00 and thereby, and to that extent, parted with power or control over the said machines.

6. In acting aforesaid, the Firstnamed Respondent and the Secondnamed Respondent acted in contempt of Court."

The references to "the Firstnamed Respondent" and "the Secondnamed Respondent" are to Eastern and the appellant respectively. The notice of motion also sought an order -

"That the Respondents within 24 hours lodge with the Court, pending the hearing and determination of the Application, any moneys received by them in respect of the sale or hire of the amusement machines referred to in the Statement of Charge."

Until a date had been fixed for the hearing of the motion notice of which had been given on 16 August 1984 it was not possible to file and serve the notice of motion dated 6 September 1984 as it was intended that both motions should come before the Court on the same date. In the result the notice of motion dated 6 September 1984 was filed on 19 September 1984 returnable on 21 September 1984.

It is common ground that the notice of motion dated 6 September 1984, the statement of charge referred to therein and the affidavits in support were not served personally on the appellant. Copies were, however, served upon the appellant's solicitor.

The motions were heard by Smithers J. commencing on 21 September 1984 and concluding on 3 October 1984 when his Honour made the orders from which the present appeal is brought.

The basic facts are not now in dispute and may be shortly stated. The appellant and his wife, Ann Susan Lazar, are and were at all material times the sole shareholders and directors of Eastern and Mazz. Mazz is engaged in the business of importing electronic amusement machines into Victoria and Eastern is engaged in the business of selling such machines or letting them on hire.

In late 1983 the appellant went to Tokyo, Japan, saw TX-1 machines which he was told were made by Tatsumi Denshi Kogyo Kabushiki Kaisha and made an agreement with a Japanese distributor, Goyo Corporation of Japan, to import into Australia nine second-hand machines. Four of those machines were imported between March and May 1984 in three consignments. The remaining five machines were imported in the first half of July 1984 in one consignment.

Of the four machines imported between March and May 1984 two, bearing serial numbers 407520 and 407621, were initially sold by Eastern to one Colin Knight "subject to finance". Those sales were not consummated and the machines were sold to Mr Sykes on 7 July 1984. Those are the machines the subject of the statement of charge dated 6 September 1984.

The five machines imported in the first half of July 1984 and which bear serial numbers 408523, 408531, 408532, 408533 and 408534 were the subject of a purchase agreement which bears date 11 July 1984 between Mazz and Morlend Finance Corporation (Vic.) Pty. Limited and a lease agreement dated 23 July 1984 between Morlend Finance Corporation (Vic.) Pty. Limited and Ian Sykes. Smithers J. found that in entering into the purchase agreement Mazz was acting as the agent or nominee of Eastern and that the transaction took place not on the date the purchase agreement bears but on 14 July 1984. The five machines the subject of the above transaction are the machines to which the statement of charge dated 16 August 1984 relates.

When the appeal came on for hearing counsel for the appellant sought, and was granted, leave to file an amended notice of appeal. Before considering the issues which arise upon the amended notice of appeal it should be mentioned that on 1 October 1984 after the evidence had been concluded and before addresses had begun Smithers J., after argument, gave leave to the applicants to amend paragraph 4 of the statement of charge dated 16 August 1984. In its amended form paragraph 4 read -

"4(a) On various dates between 12th July 1984 and 30th July 1984 the first named Respondent acting through the secondnamed Respondent sold 5 TX-1 machines to Moreland Finance Pty. Ltd. (sic), alternatively sold the said 5 machines to the thirdnamed Respondent.

(b) Alternatively on 14th July 1984 alternatively 23rd July 1984, the secondnamed Respondent sold the said 5 machines to Moreland Finance Pty. Ltd. (sic) on behalf of the thirdnamed Respondent.

(c) By his participation in the sales aforesaid, the secondnamed respondent sold the said 5 machines.

(d) By reason of the said sales the Respondents infringed the Applicants' copyright and engaged in conduct which was misleading and deceptive and so acted in contempt of the orders recited in paragraphs 1, 2 and 3 hereof."

Again the references to the first named respondent, the second named respondent and the third named respondent are references to Eastern, the appellant and Mazz respectively. The reference to the respondents in sub-paragraph (d) is to Eastern, the appellant and Mazz.

By way of preface to a consideration of the issues that arise for decision upon this appeal it is necessary to reach a conclusion as to the true meaning and scope of order 2 and paragraph (i) of order 3 of the orders made by Sweeney J. on 4 July 1984 which it is said the appellant disobeyed and to identify the contempts of which the appellant was found guilty.

As to the true meaning and scope of order 2 of the orders made by Sweeney J. on 4 July 1984 there is, I think, little room for disputation. For the appellant it was submitted that order 2 was of unclear denotation because, considered in the light of the basis of the applicant's claim to relief, it is to be read as enjoining the sale of machines answering the description set out in paragraph (i) of that order but only where such sale would infringe the applicant's copyrights in such machines and would amount to the misleading or deceptive conduct described in paragraphs (ii) and (iii) thereof. I am unable to accept that that is the true meaning and scope of the order. In my opinion the four paragraphs of the order are to be read disjunctively, each paragraph enjoining the conduct described within it. It follows that, for present purposes, Eastern and the appellant were enjoined by that order from selling, hiring out or encumbering amusement machines of the kind known as "TX-1" and bearing thereon the insignia "TX-1" and the name "Tazmi" whether or not such sale would infringe the applicants' copyrights in the machines or amount to the proscribed kind of misleading or deceptive conduct.

Paragraph (i) of order 3 of the orders made by Sweeney J. on 4 October 1984 enjoins Eastern and the appellant from parting with power, possession, custody or control (otherwise than to the applicants) "of the said amusement machines or any component or parts therefor". Then follows a coma and the words "embodying any reproduction of any substantial part of the computer programme contained within the main control panel of the said amusement machines".

The language of that paragraph gives rise to its own difficulties but on the view to which I have come concerning the contempts of which the appellant was found guilty I am relieved from the need to express any definitive opinion in relation to that paragraph.

As has already been mentioned Smithers J. had before him two notices of motion each of which referred to a statement of charge. Each statement of charge alleged a number of contempts. The formal order entered on 12 October 1984 purporting to record the orders made by Smithers J. on 3 October 1984 contains the following -

"4. The Secondnamed Respondent, Joseph Lazar, be committed to prison for 3 months in respect of each of the Notices of Motion. The terms to be served concurrently."

There is no further particularly in the formal order of the contempts in respect of which the appellant was committed. It is, however, in my view apparent from an examination of the reasons for judgment delivered by Smithers J. on 15 October 1984 that the appellant was committed to prison in respect of his conduct in relation to the sale on 7 July 1984 of the two machines to Mr Sykes referred to in paragraph 3 of the statement of charge dated 6 September 1984 and the sale on 14 July 1984 of the five machines referred to in paragraph 4 of the statement of charge dated 16 August 1984 (as originally framed and as amended).

On that view of the matter it is unnecessary to consider the arguments advanced on behalf of the appellant in relation to paragraphs 5, 6 and 7 of the statement of charge dated 16 August 1984 or paragraphs 4 and 5 of the statement of charge dated 6 September 1984.

As most of the argument was addressed to paragraph 4 of the statement of charge dated 16 August 1984 (in its original and amended forms), it will be convenient to deal with that paragraph before turning to paragraph 2 of the later statement of charge.

Paragraph 4 of the statement of charge dated 16 August 1984 alleged that Eastern, acting through the appellant, sold five TX-1 machines "and thereby infringed the applicants' copyright and engaged in conduct which was misleading and deceptive and so acted in contempt" of the order of the Court.

It is common ground between the parties that Smithers J. made no finding and, indeed, that no evidence was adduced before his Honour upon which he could have found that the conduct in which the appellant engaged amounted to an infringement of the applicants' copyright or was misleading or deceptive. If, therefore, findings on those matters were essential to the proof of the contempts alleged, there was no sufficient basis to sustain the order for committal in respect of that charge.

Counsel for the appellant contended that it was important to focus attention upon what paragraph 4 of the statement of charge dated 16 August 1984 alleged against the appellant notwithstanding that during the course of the hearing the paragraph was amended in the manner already indicated because, so he submitted, the circumstances in which that amended came to be made demonstrate that it was not intended by the amendment to depart radically from the substance of what had been alleged but rather to give greater particularity to what was alleged and to clarify the identity of the alleged purchaser of the machines.

In my opinion a fair reading of paragraph 4 leads to the conclusion that what was being alleged was that, by selling the five machines, Eastern and Mazz, through the appellant, were infringing the applicants' copyright and engaging in misleading or deceptive conduct. Those elements constituted the gravamen of the charge and it was essential, in order to support it, that all those elements be proved and proved beyond reasonable doubt. It is, I think, nothing to the point to say that it would have been a breach of the order made by Sweeney J. on 4 July 1984 to sell a machine answering the description in paragraph 2(i) of that order whether or not such sale involved an infringement of the applicants' copyright or amounted to misleading or deceptive conduct. The applicants chose to allege the contempt in language which embraced those elements and it is not, in my view, now open to them to say that the references to infringement of copyright and misleading and deceptive conduct were mere surplusage.

The amendments to paragraph 4 were effected after the conclusion of the evidence and before the addresses began. The amendments did more than give more precise particulars of the transactions alleged to have occurred. Paragraph (a) identified the seller of the five machines as being Eastern and the purchaser as being Morlend Finance Pty. Limited (sic) or Mazz. Paragraph (b) alleged as an alternative to what was alleged in paragraph (a) that the sales were made to Morlend Finance Pty. Limited (sic) by the appellant on behalf of Mazz. Paragraph (c) added an allegation that by his participation in the sales previously alleged the appellant sold the five machines. Then follows paragraph (d) in the following terms -

"(d) By reason of the said sales the Respondents infringed the Applicants' copyright and engaged in conduct which was misleading and deceptive and so acted in contempt of the orders recited in paragraphs 1, 2 and 3 hereof."

In my opinion the division of the paragraph into the four sub-paragraphs referred to did not alter the essential nature of the contempts as alleged in paragraph 4 in its original form. The gravamen of the charge was still that there had been an infringement of copyright and an engaging in misleading or deceptive conduct.

For the applicants it was submitted that the references in paragraph 4 in both its original and amended form to infringement of copyright and misleading or deceptive conduct could be read distributively with the result that there were, in effect, in respect of each alleged sale three contempts - one of a sale simpliciter, one of a sale involving an infringement of copyright and one of a sale involving misleading or deceptive conduct. In my view to read the words distributively could not result in the charge being read as alleging a sale simpliciter - that could only be achieved by treating the words in question as surplusage, an argument I have already rejected.

Although the appellant has now raised the matters discussed above, the case has the extraordinary feature that none of the questions which now arise as to the proper construction of paragraph 4 of the statement of charge dated 16 August 1984 were raised before Smithers J. From a perusal of the transcript of proceedings before his Honour it is apparent that the parties, and the Court, proceeded on the basis that what was alleged against the appellant was a sale simpliciter - no evidence was adduced as to infringement of copyright or as to the misleading or deceptive nature of the conduct relied upon and the absence of such evidence was not relied upon in address as a ground for concluding that the contempt as charged had not been established. The primary issue debated before Smithers J. in relation to the five machines was whether the sale was effected by Mazz at a time when that company was not enjoined from making any such sale and in relation to the two machines the subject of the charge dated 6 September 1984 whether the sale took place at a time prior to the issue of the interlocutory injunction.

In those circumstances the question must seriously be asked whether the appellant, who was represented by counsel throughout the proceedings before Smithers J., should now be permitted to rely on what is seen to be a fatal divergence between the contempt alleged and the evidence adduced to support it. In my opinion the divergence is not a mere irregularity in the proceedings which the appellant may be taken to have waived by his conduct. It was in my view a point of substance on which the appellant is now entitled to rely.

I, therefore, conclude that the appellant was not properly found guilty of the contempt alleged in paragraph 4 of the statement of charge dated 16 August 1984 (either in its original or amended form) and that the order committing him to prison in respect of that contempt must be quashed.

I turn now to the contempt alleged in paragraph 3 of the statement of charge dated 6 September 1984. That allegation is of a sale simpliciter and does not suffer from the vice which has been found in paragraph 4 of the earlier statement of charge. Other arguments have, however, been raised in relation to it and to those I must now turn.

It was submitted on behalf of the appellant that the applicants had failed to prove that the two machines found to have been sold by Eastern to Mr Sykes on 7 July 1984 were machines identical with those to which the Court's order of 4 July 1984 applied. The charge referred to the two machines by their respective serial numbers but while it was conceded that those machines were machines of the kind known as "TX-1" machines, it was submitted that there was no evidence to show that they were machines which bore the insignia "TX-1" or the name "Tazmi".

In my opinion this submission must be rejected. Although the learned trial Judge did not make any specific finding to that effect, there was, in my view, ample evidence before him upon which he could be satisfied beyond reasonable doubt that the machines in question bore that insignia and name. That evidence included the affidavit of the appellant sworn 13 July 1984 filed in support of the motion to vary the orders made by Sweeney J. on 4 July 1984. It was submitted that the learned trial judge was not entitled to have regard to the material in that affidavit. In my opinion that submission cannot be accepted. The contents of the affidavit constituted admissions by the appellant on which the Court was entitled to rely.

A further submission was made on behalf of the appellant that the proceedings had miscarried because the notice of motion dated 6 September 1984, the statement of charge of the same date referred to therein and the supporting affidavit had not been served personally on the appellant. It is common ground that personal service was not effected. The circumstances in which the notice of motion came to be filed have been mentioned above. The facts relating to the sale of the two machines were first addressed in the affidavit of Mr Sykes sworn on 29 August 1984 and filed in support of the notice of motion dated 16 August 1984. Upon the applicants indicating that they wished to commence further contempt proceedings in respect of the sale of the two machines, the matter was adjourned to a date to be fixed. Because of the difficulty in fixing a return day the notice of motion dated 6 September 1984 was not in fact filed until 19 September 1984. The relevant documents were served on the appellant's solicitors on 19 September 1984 when personal service could not be effected on the appellant on that day.

The appellant pointed to Order 40, rule 8 of the Federal Court Rules which provides that the notice of motion alleging that a contempt has been committed, the statement of charge provided for by Order 40, rule 6 and the affidavits in support are to be served personally on the accused person. Submissions were made that the Court had no power to dispense with the requirement of personal service, Order 1, rule 8 having no application so as to override the express requirement contained in Order 40, rule 8, or, alternatively, that, if Order 1, rule 8 did apply, it conferred a discretion to dispense with personal service which in the case of contempt proceedings should only be exercised where it can be shown that the accused person is evading service.

In my opinion Order 1, rule 8 confers a very wide discretion on the Court to dispense with personal service where the Court considers it appropriate to do so. The power which it confers is not limited by the express requirement for personal service in Order 40, rule 8 though it may be accepted that in the case of contempt proceedings as, perhaps, in other cases there will be limited circumstances in which the discretion conferred by the rule should be exercised. I am satisfied that the particular circumstances of this case were such that an exercise of the discretion to dispense with personal service was justified. The appellant's submissions on this aspect of the matter are rejected.

It was also submitted that the proceedings had miscarried because Smithers J. entertained at the same time the motion for the punishment of the appellant for contempt - a proceeding criminal in nature - and a motion civil in nature that Eastern, Mazz and the appellant lodge with the Court any moneys received by them in respect of the sale of the two machines the subject of the contempt proceedings. Reference was made to the statement of the Full Court of this Court in Australian Building Construction Employees' and Builders Labourers' Federation v. David Syme & Co. Ltd. (1982) 40 A.L.R. 518 at p. 523 that -

" . . . it would be quite wrong to require a person, who is answering a charge of criminal contempt and entitled to invoke the principle that guilt should be proved beyond reasonable doubt, to deal at the same time with an associated claim for civil relief which falls to be determined by reference to civil standards of proof."

The learned trial Judge made no order upon the claim that the proceeds of the sale be lodged with the Court. The appellant raised no objection before the learned Judge that the application for an order for payment into Court should not have been joined with the contempt proceedings and he is not now able to point to any actual prejudice which he has suffered by reason of the joinder. While I agree that the joinder ought not to have been made, the fact that the notice of motion was so expressed and the further fact that some cross-examination of witnesses was directed to the issue are not, in my view, sufficient to provide a basis, in the absence of any objection by the appellant when the matter was before Smithers J., for concluding that the proceedings for contempt miscarried on that account.

I have, therefore, reached the conclusion that no error has been disclosed on the part of the learned trial Judge in finding the appellant guilty of contempt in disobeying the Court's order dated 4 July 1984 in being the moving party in the sale by Eastern of the two machines to Mr Sykes on 7 July 1984.

For this contempt the appellant was committed to prison for three months. The appellant appeals against the severity of that punishment. The learned trial Judge took a strong view of the appellant's conduct - his Honour regarded it as both wilful and serious. With that conclusion I cannot but agree. The appellant deliberately engaged in conduct which he must have known was in breach of the Court's order and then set about endeavouring to convince the Court that no breach had occurred because the sale took place prior to the issue by the Court of the interlocutory injunction. I have discovered no sufficient basis for this Court to interfere with the punishment which his Honour saw fit to impose.

In my opinion the appeal, so far as it relates to the contempt consisting in the appellant's conduct with respect to the sale of the two machines on 7 July 1984 should be dismissed but allowed in so far as it relates to the contempt consisting in the appellant's conduct in respect of the sale of the five machines on 14 July 1984. The order committing the appellant to prison for three months for the contempt relating to the sale on 7 July 1984 should be affirmed.