NEW SOUTH WALES COURT ISSUES JUDGEMENT FOR SKYTRADERS V/S IAN WALLACE MEYER, ET AL. CASE

Australia, Nov. 30 -- New South Wales Land and Environment Court issued text of the following judgement on Nov. 29:

1. On 30 October 2024 the Court heard an amended notice of motion filed by the plaintiff in these proceedings, Skytraders Pty Ltd on 27 August 2024.

2. By the time the motion was heard, there were only two prayers of the motion left for determination:

1) Prayer 2 of the motion required the Court to determine whether the solicitors for the defendant and first respondent on the motion, Mr Ian Wallace Meyer, should be required to provide the plaintiff's solicitors with a Forensic Image containing certain documents over which claims for privilege have been made by Mr Meyer; and

2) Prayer 3 of the motion which concerned whether Mr Meyer should be required to pay Skytraders' indemnity costs (or in the alternative its ordinary costs) of and incidental to the application of incorrect search terms which were applied by Mr Meyer's IT expert during the discovery process to these proceedings.

3. For the reasons which follow, the Court does not accept Skytraders' submission that all of the disputed documents should be disclosed by Mr Meyer. It was accepted by Skytraders during oral submissions that the only ground of objection to the claim of privilege was that there was insufficient evidence available to establish such a claim. The Court is satisfied that the evidence does demonstrate the documents are privileged and should not be disclosed.

4. As to who should bear the costs of the error by Mr Meyer's IT expert, the Court concludes that these costs should be Skytraders' costs thrown away in the proceedings. No case has been made out for those costs to be other than on the ordinary basis. Skytraders contended for their costs thrown away to be defined by specific categories of costs (see [75] below). The Court declines to adopt such a course for two reasons: first, because costs assessors are experienced in identifying which costs are thrown away in the proceedings without being confined to identifying specific categories of costs thrown away; and, second, the determination of which costs are thrown away should be considered at the end of the proceedings without the Court attempting at this stage to identify any categories of such costs.

5. Mr A Zahra of Senior Counsel appeared for Skytraders, Mr M Davis of Counsel appeared for Mr Meyer.

General background of proceedings and motion

6. These proceedings have had a long and complicated history since their commencement by summons before Robb J sitting as Duty Judge. Since that time the parties have been at loggerheads over the implementation of various interlocutory orders and disputes have been heard by several judges of this Court.

7. In December 2021, the matter came before Rein J who considered competing motions by both parties as to whether Skytraders' forensic expert should have access to documents seized as part of a search order to conduct a 'mapping process' or whether Mr Meyer should be entitled to provide discovery to Skytraders in the ordinary course (see Skytraders Pty Ltd v Meyer [2021] NSWSC 1670 (Skytraders (No 1)).

8. In Skytraders (No 1) Rein J provided a helpful overview of the factual background to the proceedings which I gratefully adopt:

1. The First Defendant, Mr Ian Wallace Meyer, was employed by the Plaintiff, Skytraders Pty Ltd ("Skytraders"), as a flight operations manager for a number of years. In December 2019, Mr Meyer announced his resignation from Skytraders, and he ended his employment with Skytraders on 12 January 2020. On 13 January 2020, he commenced employment with the Second Defendant, Air Affairs (Australia) Pty Ltd ("Air Affairs").

2. In March 2021, Skytraders became aware that Mr Meyer still had access to its Dropbox account ("the Skytraders Dropbox Account") and it became aware that he had accessed a number of documents in the period since he had left Skytraders's employment. Skytraders became aware that Air Affairs, a competitor of Skytraders, had become, or appeared to be, interested in several significant contracts that were up for renewal and which Skytraders was keen to retain or apply for.

3. Skytraders commenced proceedings on 17 March 2021 and obtained, from Robb J sitting as the Duty Judge, search orders against Mr Meyer and Air Affairs ("the First March Orders"). Those orders required Mr Meyer and Air Affairs to hand over documents physically held and also to hand over or permit access to documents and information stored on various identified devices for the purpose of copying those devices. The process involved, as is usual, the intervention of independent solicitors and independent forensic computer experts.

4. The initial aspect of the process was carried out and the forensic experts have made digital copies of the devices of both Mr Meyer and Air Affairs. The First March Orders required assessment of the images made but this process has been held up by reason of the applications of the Defendants.

5. Skytraders seeks to have the forensic experts proceed with what is described as a "mapping process" which will involve the identification of the file paths of folders and the nature of the files contained on each drive. That process will not reveal the content of any document, but it will, Skytraders believes, on the basis of the forensic experts' evidence, enable the work of "interrogation" of the digital information to be cut down to a more manageable size which may reduce the costs involved since it is likely to remove a number of the digital devices from further consideration. The cost of conducting the mapping process is said to be in the order of $20,000: see T.92.37-38. Skytraders will, at least for present, bear that cost.

6. At the hearing before me on 19 November 2021, Skytraders filed a Statement of Claim ("STOCL"). The STOCL pleads no case against Air Affairs. At the hearing, agreement was reached between Skytraders and Air Affairs that the proceedings as against Air Affairs would be discontinued, Skytraders would pay Air Affairs's costs and Air Affairs would undertake to maintain the integrity of all images on identified devices for two years from 19 November 2021. The application for access to the copy of Air Affairs's server is no longer made and the only material belonging to Air Affairs in respect of which Skytraders seeks mapping to be carried out is the laptop owned by Air Affairs but in the possession of Mr Meyer.

*Rest of the document and Footnotes can be viewed at: (https://www.caselaw.nsw.gov.au/decision/19371479559afea875f7e606)

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