CATCHWORDS
PATENT - action for infringement - cross-application seeking declaration of invalidity - requirement that claims be fairly based on the complete specification.
PATENT - action for infringement - cross-application seeking declaration of invalidity - requirement that invention be useful.
PATENT - costs - action for infringement - cross-application seeking declaration of invalidity - cross-application based on multiple grounds - numerous grounds not pressed or unsuccessful - cross-application successful on 2 grounds - but for invalidity of patent infringement proved - discretion as to order for costs.
Patents Act 1990 s 40, s 138, s 233
NV Philips Gloeilampenfabriken v Mirabella International Pty Ltd 44 FCR 239
Sami S. Svendsen Inc v Independent Products Canada Ltd 119 CLR 156
Edison & Swan Light Co v Holland 6 RPC 243
Samuel Taylor Pty Ltd v SA Brush Co Ltd 83 CLR 617
AMP Inc v Utilux Pty Ltd 45 ALJR 123
Olin Corporation v Super Cartridge Co Pty Ltd 180 CLR 236
Sartas No 1 v Koukouran 30 IPR 479
Minnesota Mining and Manufacturing Co v Beiersdorf (Australia) Pty Ltd 144 CLR 253
F. Hoffman - La Roche & Co Aktiengesellschaft v Commissioner of Patents 123 CLR 529
PATENT GESELLSCHAFT AG v SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
No 444 of 1992
Olney J
Melbourne
21 February 1996 and 18 March 1996 (Costs)
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION No VG 444 of 1992
BETWEEN:
PATENT GESELLSCHAFT AG
Applicant
-and-
SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
Respondent
-and-
SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
Cross Applicant
-and-
PATENT GESELLSCHAFT AG
Cross Respondent
Coram: Olney J
Place: Melbourne
Date: 18 March 1996
MINUTE OF ORDERS
THE COURT:
1. Orders that the application be dismissed.
2. Declares that Australian Letters Patent 500194 and each of the claims thereof was at all material times invalid.
3. Orders that each party pay its own costs of the proceeding.
4. The funds held in Court as security for the respondent's costs of the proceeding be paid out to the applicant's solicitors on 12 April 1996 unless on or before that date the applicant gives notice of appeal in which case the funds are to remain in Court pending further order of the Full Court.
NOTE: Settlement and entry of orders is dealt with under Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION No VG 444 of 1992
BETWEEN: PATENT GESELLSCHAFT AG
Applicant
-and-
SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
Respondent - and-
SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
Cross Applicant
-and-
PATENT GESELLSCHAFT AG
Cross Respondent
Coram: Olney J
Place: Melbourne
Date: 18 March 1996
REASONS FOR JUDGMENT - COSTS
On 21 February 1996 I published reasons for my conclusion that the applicant's claim for infringement of Australian Letters Patent 500,194 should be dismissed and that there be an order on the cross-application declaring the patent invalid.
At the time of publishing my reasons no orders were made. The matter was stood over until 29 February 1996 to give the parties an opportunity to consider my reasons and to make submissions as to the appropriate form of orders and also to address the question of costs. Following submissions from counsel I reserved the matter for further consideration.
There is no dispute between the parties as to
the nature of the
substantive orders that should be made to reflect my decision in the proceeding
but the parties are at odds on the question of costs. The respondent/cross-applicant (who I will
refer to as the respondent) seeks an order dismissing the application with
costs and an order on the cross-application declaring the patent invalid with
costs. The applicant/cross-respondent
(who I will refer to as the applicant) submits not only that there should be no
order for costs against it on either the application or the cross-application
but further, that the respondent should be ordered to pay a proportion of its
costs of the proceeding.
The applicant's case for infringement failed because I concluded that the patent was invalid. But for the invalidity the infringement claim would have succeeded. In pleading its case against the validity of the patent the respondent raised many issues which were either not pursued at trial or were abandoned in the course of the trial. Further, it failed on a number of issues which were pleaded and also on the issue relating to the priority date.
If the usual rule that costs should follow the event is applied in this case the orders sought by the respondent would be appropriate, but in patent cases there have been many occasions when courts have exercised a greater than usual degree of creativity in framing costs orders so as to more readily do justice between the parties.
The applicant has filed affidavit evidence in support of the proposition that substantially the whole of the costs in the proceeding were incurred in relation to issues which were found in favour of the applicant or which were abandoned by the respondent. The affidavit makes an analysis of the particulars of objection pleaded by the respondent including amendments made during the trial. Many of the pleaded particulars were abandoned either before or at the commencement of the trial and others were not pressed. Indeed, in its final written submission the respondent expressly relied upon only the 6 propositions (including non-infringement) which are set out at pp 2-3 of my reasons.
The applicant's affidavit also makes an analysis of
the time spent at trial in dealing with various issues and the number of pages
in the affidavit evidence relating thereto.
The conclusion is expressed that the Court time devoted to issues decided
in favour of the respondent expressed as a percentage of total Court time
occupied by the respondent's witnesses in testifying was 6%. It is also estimated that not more than 7%
of the applicant's affidavit evidence and not more than 10% of the time
occupied by the applicant's witnesses at trial were devoted to the issues of
the delivery of food directly from the bulk storage tanks to the individual
sheep confinement pens and of ventilation.
It is also asserted that by far the greater part of the applicant's case
dealt with the issues of novelty, invention and inventorship and in particular
much of the expert evidence was devoted to a detailed examination of materials
relating to each alleged prior art vessel. Further, it is said
that the affidavit evidence of many of the
applicant's witnesses was confined to rebutting the respondent's suggestion
that the concept of converted oil tankers was known before the priority date
and to establishing the commercial success of the invention.
I have not found it necessary to check the applicant's assertions as to percentages to which reference is made above, nor is it particularly relevant whether or not the figures are correct. But the other general assertions are clearly well founded and are consistent with the impression which I gained in the course of the proceeding.
In its submission in relation to costs the
applicant has referred to a number of well known authorities including Hughes
v WACA (1986) ATPR 40-748, Dodds Family Investments Pty Ltd v Lane Industries
Pty Ltd (1993) 26 IPR 261; Rediffusion
Simulation Ltd v Link-Miles Ltd (1993) FSR 369 and C. Van Der Lely NV v Ruston's
Engineering Co (1993) RPC 45.
The general thrust of these authorities and of a number of other single
judge decisions to which reference was also made is that in the absence of
special circumstances costs follow the event but the costs order should reflect
the degree of success obtained and a successful party may be ordered to pay
some costs in respect of unsuccessful aspects of the case (Hughes); the community's
interest in economy and efficiency in litigation may be reflected in a
qualification of the presumption that a successful party is entitled to its
costs (Dodds Family); the costs
order in a patent case should where appropriate reflect the extent to which
significant sums of costs
have been thrown away by reason of one party, albeit successful overall,
raising and pursuing unsuccessful points (Van Der Lely); where a successful party raises issues or
allegations improperly or unreasonably the Court may not only deprive him of
his costs but might order him to pay the whole or part of the unsuccessful
party's costs (Rediffusion). However,
a successful party who neither improperly nor unreasonably raised issues or
made allegations on which he failed ought not be ordered to pay any part of the
unsuccessful party's costs (Rediffusion).
Before descending to particulars I make three general
observations. First, it is
inappropriate to treat this proceeding as if it were two cases, that is an
application for infringement and a cross-application claiming a declaration of
invalidity. The cross-application was
necessary as a defence to the infringement claim and in my view the proceeding
should be treated as one case. Second,
this is not a case in which a mathematical assessment can be made of the time
spent in pursuing particular issues with a view to awarding costs on a pro-rata
basis to the party which has succeeded on each separate issue. The proceeding was far too complex for such
an approach to be adopted. However it
is fair to say that much time was occupied and considerable expense was
incurred in dealing both at trial and before trial, with issues which were
either not pressed by the respondent or on which it failed. Third, a successful party who has in the
course of litigation changed the basis of its case and has thereby caused the
opposite party to unnecessarily incur costs can usually expect that it will
have to bear the burden of
any costs thrown away. All of these
considerations are taken into account in the following assessment of this case.
I do not propose to canvass in detail the various issues which arose in the proceeding. The reasons published on 21 February 1996 set out my findings and these reasons should be read as supplemental to the former. There are nevertheless a number of major questions to which reference should be made.
The respondent attacked the validity of the patent on the ground that Hansen was not the inventor. Allied with this was the claim that Hansen had obtained the patent by making a false declaration to the Patent Office. The evidence disclosed that the patent application had been opposed by Evans and Dannebrog. Both withdrew their objections after negotiating a settlement with Hansen. The main witnesses (Hansen and Evans) were obviously in the applicant's camp. The respondent was not privy to any of the negotiations leading to the settlement of the objections and it was not unreasonable that the respondent should wish to test the question of whether or not Hansen was the inventor. As it happened, the respondent failed on this issue but in the circumstances of the case no adverse costs consequences should flow to the respondent by reason of such failure. I do not regard the allegation of false declaration as being equivalent to an allegation of fraud against Hansen as has been suggested by the applicant.
The question of whether or not there had been a
prior
publication
of the invention occupied considerable time, particularly in relation to the
meeting of 7 November 1975 and the events which followed. Here again the respondent failed to make out
the case upon which it sought to rely. But
in this case none of the evidence it relied upon was supportive of its
case. It had access to all of the
relevant witnesses, particularly Pedersen whose evidence on critical issues
proved unreliable. The evidence of
Johnson, Pedersen and Martin (all called by the respondent) did not support the
respondent's allegations. Johnson's
evidence and some aspects of Pedersen's proved to be particularly
unsatisfactory. To some extent this
could be attributed to the fact that the applicant had left it so long before
commencing the proceeding, but not entirely.
There is in my view justification to discount the respondent's
entitlement to costs to reflect the additional unnecessary expense to which the
applicant was put in the respondent's pursuit of this aspect of the case.
It is unnecessary to detail the various issues which the respondent abandoned either before or at trial. There is merit in the applicant's submission that allowance should be made in its favour to recognise the additional unnecessary costs it incurred. The respondent chose, no doubt for tactical reasons, to plead at enormous length many particulars of invalidity which it did not press. It is not possible to accurately assess the costs to which the applicant was thereby put but I am of the view that any allowance in the applicant's favour should be significant.
The applicant asserted that the respondent infringed its patent. It did so knowing that the mere registration of the patent was no guarantee of its validity. It failed to support the validity of the patent and as a result failed in its action for damages. Except to the extent I have mentioned the respondent's response to the application was not unreasonable. It succeeded on the general question of validity which enabled it to successfully resist the claim for infringement.
The respondent's tactics have occasioned an unnecessary prolongation of the trial and thus have caused the applicant to incur unnecessary expense. On balance I think it is fair to conclude in the facts of this case, given the degree of success on an issue by issue basis enjoyed by the respective parties that justice will be done if each party pays its own costs of the proceeding. I do not regard the respondent's conduct of the case as being so unreasonable as to warrant an order for costs in the applicant's favour.
I certify that this and the preceding 7 pages are a true copy of the Reasons for Judgment of the Honourable Justice Olney
Associate:
Dated:
Heard: (as to costs) 29 February 1996.
Place: Melbourne
Judgment:18 March 1996.
Appearances:
Mr R. Macaw QC and Mr B.J. Hess (instructed by Corrs Chambers Westgarth) appeared for the applicant/cross respondent.
Mr D. Shavin QC and Mr A.J. Ryan (instructed by Finlaysons) appeared for the respondent/cross applicant.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION No 444 of 1992
PATENT GESELLSCHAFT AG
Applicants
-and-
SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
Respondent
-and-
SAUDI LIVESTOCK TRANSPORT AND TRADING COMPANY
Cross Applicant
-and-
PATENT GESELLSCHAFT AG
Cross Respondent
Coram: Olney J
Place: Melbourne
Date: 21 February 1996
REASONS FOR JUDGMENT
INTRODUCTION
This case has to do with patent rights associated with the conversion of oil tankers to ships for the conveyance of large numbers of livestock.
The applicant is the registered proprietor of Australian Letters Patent 500,194 (the patent) and by its application filed on 19 November 1992 seeks relief in respect of the alleged infringement of the patent by the respondent on 37 occasions between 23 June 1986 and 30 June 1992. To the extent that relief is sought in respect of 3 alleged infringements which occurred before 19 November 1986 the claim is statute barred but otherwise the claim is unaffected by the provisions of s 120(4) of the Patents Act 1990.
The patent is said to have been infringed by the respondent without the licence or authority of the applicant importing into Australia and using and exercising in Australia the ship Mawashi al Gasseem by causing the ship to enter into Australia and berth at certain identified Australian ports and there to load livestock, in particular sheep, and then to carry such livestock in Australia and from Australia.
The respondent admits to having been the owner of Mawashi al Gasseem at all relevant times but denies having infringed the patent and by way of cross-application seeks a declaration that the patent and each of the claims of the complete specification thereof were, at all times, invalid. The respondent's defences are based upon the following assertions:
1. The claimed invention does not involve an inventive step (i.e. there is no new manner of manufacture, it is obvious);
2. The specification does not comply with s 40 of the Patents Act;
3. The claims are not fairly based on the basic Danish application from which a priority date of 28 November 1975 is claimed. Consequently they are entitled only to a priority date of 17 September 1976 and are prior published;
4. If there was an invention, Mr Hansen (the original applicant for the patent) was not the inventor, was not entitled to apply for the patent and obtained it by making a false declaration to the Patent Office;
5. The invention claimed is not useful;
6. The claims of the patent, properly construed, are not infringed.
The trial of the questions of infringement and validity took place at Melbourne over 15 hearing days. The evidence-in-chief of all witnesses was on affidavit. Of the 34 separate witnesses whose affidavits were read 28 were required to attend for cross-examination. With only two exceptions, all witnesses called for cross-examination had travelled to Melbourne either from overseas or from interstate. At the close of the evidence final submissions were made both in writing and orally. A week or so prior to the commencement of the trial, in company with counsel for both parties, several of the expert witnesses and the master of the ship, I inspected Mawashi al Gasseem at Port Adelaide. The inspection was unexpectedly truncated when the ship caught fire, but by then it had been substantially completed.
Before dealing in detail with the evidence I wish to
make a number of observations. The
affidavit evidence on both sides contained much hearsay and non-expert opinion
evidence as well as a great deal of pure speculation, all of which would
ordinarily have attracted objections from the opposing counsel and resulted in
lengthy argument. To their great
credit, the
parties adopted the sensible expedient of agreeing in advance that no
objections would be taken to any of the affidavit material. This is not to say that it was agreed that
everything in the affidavits was conceded to be admissible and probative of the
facts asserted. Rather, it was left to
the Court to make its own assessment of the relevance and weight to be attached
to the written testimony. This is much
easier said than done, but as all of the main witnesses were cross-examined,
some at considerable length, it has been possible to make an assessment of the
personal credit of the witnesses and thus to view in a proper perspective their
affidavit evidence.
For the most part the witnesses were required to testify as to events which occurred 20 years and more ago. Those events were in many cases not matters which at the time were of such significance as to be likely to make such a lasting impression on the minds of those involved that two decades later it could be expected that the details would remain clear. Indeed, it is surprising that so many of the witnesses were able to recall as much as they did and to the extent that for the most part they were unaided by contemporary records it is not surprising that there has been a degree of confusion as to such things as dates and places, the identity of persons who took part in conversations and the precise sequence of events.
Several of the overseas witnesses gave their evidence
in what would have been their second or third language. It was of considerable convenience to the
Court that all testimony was
given in English and it is necessary to recognise that some of the witnesses
were thereby placed at a disadvantage.
Nevertheless, I am confident that the evidence of those witnesses was
properly understood.
Unfortunately the expert evidence was not altogether helpful. Each party called two naval architects each of whom expressed opinions consistent with his co-expert and in contradiction of the experts of the opposite party. One intriguing aspect of the expert evidence was the ability of the applicant's experts to attribute a meaning to a combination of words in the patent specification containing a typographical error which on any reading did not make sense. This matter is referred to briefly later in these reasons in relation to "the hollow lid". I mention it here only as an example of the relative lack of objectivity in the expert evidence. On the whole I do not think that the expert evidence has had very much bearing upon the outcome.
THE PATENT
The patent was granted to Christian Kjellerup Hansen
(Hansen) by Letters Patent sealed on 20 March 1980. Hansen is identified as the actual inventor
of the invention which is entitled "A long distance livestock
carrier". The term of the patent
was for 16 years. It expired on 17
September 1992. The patent was granted
on a Convention application, the basic application having been filed in Denmark
on 28 November 1975. It is common cause
that if the patent is valid and is
found to be fairly based on the Convention application the priority date would
be 28 November 1975 whereas (assuming validity) if it is not fairly based on
the Convention application, the priority date would be 17 September 1976.
The applicant became the registered proprietor of the patent on 9 August 1990 pursuant to an assignment from the patentee.
The claims made in the complete specification defining the invention are as follows:
1. An ocean-going ship constructed by conversion of an oil tanker vessel to one for transport of a main cargo of livestock, said vessel comprising a decked hull enclosing a plurality of bulk storage tanks occupying a major proportion of the hull volume; a multi-storeyed superstructure standing up from the deck of the hull and including a plurality of animal confinement pens in each storey; livestock food conveyor means extending from one or more of said storage tanks to said livestock confinement pens whereby livestock food can be bulk stored in said one or more storage containers and conveyed directly therefrom to each of said confinement pens by said food conveyor means; and livestock water conveyor means extending from another or others of such storage tanks to said livestock confinement pens whereby water can be bulk stored in said another or others of said storage tanks and delivered directly therefrom to each of said confinement pens by said water conveyor means.
2. An ocean-going ship as claimed in claim 1, wherein the food conveyor means and the water conveyor means are comprised of separate pipelines inter-connecting the respective storage tanks with said confinement pens and means operable to cause food and water to be conveyed through the respective pipelines to said confinement pens.
3. An ocean-going ship as claimed in claim 1 or claim 2, wherein said superstructure defines access corridors extending between adjacent rows of pens, each of said corridors extending upwardly through two storeys of the superstructure so as to provide for accessibility to two rows of pens at each side of the corridor.
4. An ocean-going ship substantially as hereinbefore described with reference to the accompanying drawings.
(For present purposes it is unnecessary to reproduce the drawings which accompany claim 4).
Each of claims 2 and 3 is dependent on claim 1. It is common cause that claim 1 is a combination claim. It is also common cause that the integers of claim 1 are:
(a) an ocean going ship;
(b) constructed by conversion of an oil tanker vessel to one for transport of a main cargo of livestock;
(c) said vessel comprising;
i) a decked hull enclosing a plurality of bulk storage tanks;
ii) [said storage tanks] occupying a major proportion of the hull volume;
iii)a multi-storey superstructure standing up from the deck of the hull;
iv) [said multi-storey superstructure] including a plurality of animal confinement pens in each storey;
v) livestock food conveyor means;
vi) [the said livestock food conveyor means] extending from one or more of said storage tanks to said livestock confinement pens;
vii)whereby livestock food can be bulk stored in said one or more storage containers;
viii)and conveyed directly therefrom to each of said confinement pens by said food conveyor means;
ix) and livestock water conveyor means;
x) [said livestock water conveyor means] extending from another or others of said storage tanks to said livestock confinement pens;
xi) whereby water can be bulk stored in said another or others of said storage tanks;
xii)and delivered directly therefrom to each of said confinement pens by said water conveyor means.
PATENTS ACT
The patent was granted under the provisions of the Patents Act 1952 which was repealed by s 230 of the Patents Act 1990. By virtue of s 233(1) of the 1990 Act, that Act applies in relation to a standard patent granted under the 1952 Act subject however to s 233(4) which provides:
(4) Objection cannot be taken to a patent mentioned in subsection (1), and such a patent is not invalid, so far as the invention is claimed in any claim, on any ground that would not have been available against the patent under the 1952 Act.
In NV Philips Gloeilampenfabrieken v Mirabella International Pty Ltd 44 FCR 239 the Full Court of the Federal Court had occasion to consider the effect of the transitional provisions of the 1990 Act. At 253-4 Lockhart J (with whom Northrop and Burchett JJ agreed on this issue) said:
In my opinion the evident intent of s 233(4) is to ensure that the grounds of revocation under the 1990 Act (which, though in some cases are expressed in different terms, are essentially the same as the grounds previously available under s 100 of the 1952 Act) apply as the grounds for revocation of a 1952 Act patent; but with this important qualification, namely, that the elements of each ground of revocation under the 1990 Act apply only to the extent that they replicate in substance the elements that previously constituted a ground of revocation under the 1952 Act. Hence, if a ground of revocation under the 1990 Act omits an element which was a necessary part of a ground under the 1952 Act, the patentee has the benefit of it. On the other hand, if a ground under the 1990 Act contains an element not previously present under the 1952 Act, it cannot apply in aid of revocation of the 1952 Act patent. In short, a 1952 Act patentee is not to be worse off than he would have been if the 1952 Act had continued to operate, but he may be better off if the 1990 Act treats a former element of a ground of revocation as being no longer necessary.
Special leave to appeal to the High Court from the decision of the Full Court was granted but was confined to a point of construction concerning the meaning of the phrase "manner of manufacture" in s 18 of the 1990 Act. Since the conclusion of the trial in this case the High Court has delivered its decision but by reason of the limited basis of the appeal there is nothing in the Court's reasons which bears upon the application of the transitional provisions of the 1990 Act and accordingly the propositions expressed by Lockhart J in the Full Court stand as an expression of the present state of the law.
It is common ground that in this case there is no material difference in the wording of the relevant provisions of the 1952 Act and the 1990 Act to give rise to any difficulty in determining the available grounds of revocation.
Section 138(3) of the Patents Act 1990 provides:
138(3) After hearing the application, the court may, by order, revoke the patent, either wholly or so far as it relates to a claim, on one or more of the following grounds, but on no other ground:
(a) that the patentee is not entitled to the patent;
(b) that the invention is not a patentable invention;
(c) that the patentee has contravened a condition in the patent;
(d) that the patent was obtained by fraud, false suggestion or misrepresentation;
(e) that an amendment of the patent request or the complete specification was made or obtained by fraud, false suggestion or misrepresentation;
(f) that the specification does not comply with subsection 40(2) or (3).
Each of grounds (a), (b), (d) and (f) is raised by the defences relied upon by the respondent.
BACKGROUND
Sheep have been exported from Australia by sea for many years although for a period in the early 1970s such exports were banned by the Australian government. In all cases the vessels used as sheep carriers have been converted from ships originally built for some other purpose, notably passenger liners and cargo vessels, but until 1976 no oil tanker had been converted for use as a sheep carrier. Oil tankers had however been converted for other purposes. No ship had ever been custom built as a sheep carrier.
In the early stages of the development of the sheep trade from Australia, the sheep were accommodated below the weather deck. As the trade developed some ships had sheephouses constructed above deck as well as having below deck accommodation but before 1976 there had been no sheep carrier which housed all of the sheep above the weather deck.
The carrying capacity of sheep carriers has varied considerably. Before 1976 the maximum number of sheep that any vessel could carry was about 30,000 but most had a capacity much less than that.
Prior to the development of pelletised feed in the
early 1970s live sheep on export vessels were fed on hay. There were numerous disadvantages associated
with the use of hay including the following:
First, the density of hay is very low (about 80-100 kgs per cubic metre
compared with 480 kg per
cubic metre for pellets) which necessitated large storage space being required
on board. Second, the food value of hay
is very low, thus a large mount of hay must be carried to provide sufficient
feed. Third, there is a great deal of
wastage with hay as much of it finishes up on the floor of the pen and becomes
soiled with urine and dung. Fourth,
loading of hay is slow and labour intensive.
When pellets were first introduced they were supplied in bags which were stowed on board. The sheep were fed manually using a wheelbarrow and shovel. This system was fairly soon abandoned in favour of bulk storage. Bulk loading was by means of pneumatic blower trucks which blew the pellets into the ships' holds. On board, the feed was shovelled into containers and lifted in a lift to the required deck level where it would be distributed to the sheep pens manually. In about 1972 pneumatic blowers were used on board. Pellets were sucked up by a hand-held nozzle into a pipe and into a pneumatic conveyor and blown into other pipes to day tanks on each deck level. At the day tank a gate was used to release feed into buckets or wheelbarrows for distribution to the troughs. The equipment for this method of distribution was available and in use in Australia prior to 1975. It was used on sheep carriers Aurore and Ariane in 1974. In or about 1974 a system was developed which involved a day tank on the main deck in which feed was stored above the below deck sheephouse and using gravity, feed was supplied through drop spouts to each deck below where it could be drawn off through a gate into a bucket or wheelbarrow for distribution to the troughs. This method avoided the need to have day tanks on each level. The next development was the multiple splinter drop spout (or "Christmas tree") system whereby a number of drop spouts are run from a day tank to sheep decks below with branches to each trough. The drop spout's diameter is varied according to the spout's length to ensure that the spout contains only the required amount of feed. The feed is distributed from the outlet of the "Christmas tree" over the length of the troughs in the pens by hand. This system was not in use on ships in Australia until after November 1975.
The foregoing description of the various developments in shipboard feeding systems is based upon the evidence of Bart Benschop, a consulting engineer, who has had extensive experience in the field.
As a result of the so-called oil shocks of 1973 many oil tankers became surplus to the demand and were laid up or converted to other uses. The cost of purchasing tankers fell dramatically. Another consequence of the large increase in oil prices was increased prosperity in some Middle Eastern countries and with that prosperity an increase in the demand for sheep from overseas, particularly from Australia. At about the same time the embargo on the export of live sheep from Australia was lifted. The available tonnage of sheep carriers was not adequate to cope with the increase in demand.
In the latter part of 1975 companies associated with Hansen and his business partner James Martin Evans (Evans) negotiated a contract to supply 800,000 sheep to the Iranian Meat Organisation (IMO) over a two year period. Prior to that time the total of all sheep exports from Australia to the Middle East had not exceeded 1.3m per annum.
Early in 1976 the oil tanker Tindfonn was acquired by Hamburg Sud and was converted to a live sheep carrier. The vessel was renamed Atlas Pioneer. The conversion was carried out at the Mitsubishi shipyard in Kobe, Japan, for the new owner which had agreed to charter the vessel to Hansen for the purpose of transporting sheep from Australia to the Middle East. Atlas Pioneer first arrived in Australia at Port Adelaide on 10 April 1976 where it loaded some 50,000 sheep.
Atlas Pioneer was the first former oil tanker to be converted to a sheep carrier. It was also the first sheep carrier to house the whole of its cargo above the weather deck. At the time it was, by far, the ship with the largest capacity to transport live sheep.
Hansen was not the only person to have addressed the problem of expanding the capacity of sheep carriers to meet the increased demand for live sheep in the Middle East. Others with a similar interest in the problem included Ole Pedersen and Christopher Burbury. Reference will be made later to the evidence given in relation to the involvement of each of these individuals and of those associated with them. To some extent their stories are intertwined.
MAWASHI AL GASSEEM
As the claimed infringements of the patent are related to the use in Australia of Mawashi al Gasseem it will be convenient to say something of the features of that vessel which have attracted attention in this proceeding.
There is no doubt that Mawashi al Gasseem is an ocean-going ship constructed by conversion of an oil tanker vessel to one for transport of a main cargo of livestock, that it comprises a decked hull enclosing a plurality of bulk storage tanks occupying a major portion of the hull volume and that it has a multi-storey superstructure standing up from the deck of the hull which includes a plurality of animal confinement pens in each storey. Furthermore, livestock food is bulk stored in one or more of the below deck storage tanks and livestock water is bulk stored in another or others of the said storage tanks. The livestock food and water is conveyed from the respective storage tanks to the confinement pens in the manner to be described below. Central to this proceeding is the question of whether the respective conveyor means convey livestock food and water directly from the storage containers to each of the confinement pens.
Another feature of Mawashi al Gasseem is that it has a mechanical ventilation system which provides fresh air to the confinement pens.
There is no dispute between the parties as to the physical structure of the ship nor as to its method of operation. The following description of the vessel and the process by which it was converted is based upon the affidavit evidence of Robert Grool (Grool) a naval architect who between January 1982 and August 1987 was employed in various capacities by the respondent and who in the course of such employment was responsible for overseeing the conversion of the oil tanker Lynda to a livestock carrier which was then renamed Mawashi al Gasseem.
The conversion involved, amongst other things, the erection of a sheephouse on the deck of the vessel. The sheephouse comprises 6 decks with each deck containing two tiers of pens. The sheephouse contains 864 such pens arranged 6 abreast on each deck and divided by alleyways. Each pen is about 1.13 metres high and has a floor area of about 35 square metres. Each pen accommodates about 110 animals (based upon an average weight per animal of 49.9 kilos). The total length of the sheephouse is 112 metres and its width is 33.7 metres. Its height is 18.4 metres. The sheephouse is arranged in 3 large sections each of which is divided by expansion joints. The conversion was performed at the Hyundai Mipo dockyard in Ulsan, Korea between approximately August 1982 and August 1983. It required the complete relocation of the wheelhouse, bridge wings and all associated services, radar and navigational equipment from aft of Lynda on to the top of the front of the sheephouse. This was necessary because the sheephouse is higher than the wheelhouse was in its former position. The vessel was shortened by approximately 45 metres and a refrigerated container storage space was installed forward of the sheephouse.
The system of conveyors and elevators for the loading and distribution of feed operates on the vessel in the following way:
(a) feed from shore is loaded in the No 5 port and starboard wing tanks;
(b) if loading is from the port side, a chain conveyor on the weather deck also distributes the feed to the starboard feed tank and the opposite occurs if loading is from the starboard side;
(c) two further chain conveyors distribute the feed longitudinally along the length of the feed tanks;
(d) the feed falls to the bottom of the feed tanks;
(e) when required the feed is released through the hoppers and is then collected by chain conveyors which carry it to the bucket elevators in the feed handling spaces.
(f) the feed is then taken by the bucket elevators to the top of the sheephouse.
(g) on the top of the sheephouse the feed is distributed again by chain conveyor to 54 day tanks. A chain conveyor also runs laterally along the top of the sheephouse.
(h) the feed is held in these days tanks until it is required for use;
(i) from the day tanks the feed falls through down-pipes which are opened manually to allow the feed to flow into troughs located at each pen. There are three troughs at each of the 864 pens.
Grool's description, although correct in its detail, may be somewhat misleading if it conveys the impression that feed held in the day tanks is retained there until required and when required is released into the down-pipes which service the individual pens. What in fact happens is that feed is conveyed from the bulk storage tanks by the means described to the day tanks and then by gravity runs into the down-pipes at the base of the day tanks. The free flow of the feed is stopped only by the valves at the lower end of the down-pipes adjacent to the pens. Obviously, with the valves closed the feed banks up and once the down-pipes are filled it remains in the day tanks until the valves are opened for the purpose of filling the troughs from which the feed is consumed by the livestock.
HANSEN'S STORY
Hansen's story is really the story of both Hansen and Evans. They were co-venturers. They are the directors and shareholders of the applicant.
Hansen left school in 1948 and became apprenticed to C.K. Hansen Shipping Company of Copenhagen (C K Hansen), a family company established by his great-great-grandfather in 1856. It was then the largest shipping agent in Denmark and its business included managing a steamship company named Dannebrog Rederi A.S. (Dannebrog). After completing his apprenticeship he worked as a shipping clerk in various shipping offices in Germany, Holland, France and England and for two years was a chartering clerk with C K Hansen. In 1957 he established his own shipping business which managed two tramp vessels engaged in international trade. In 1960 he became one of four partners in C K Hansen and remained such until 1967 when he and a relative, Baron Wedell Wedellsborg (the Baron), purchased a controlling interest in Dannebrog whereupon the business of the shipowning company (Dannebrog) was separated from the ship broking business (C K Hansen). From 1967 to 1973 he was managing owner of Dannebrog and a partner in a Copenhagen firm of shipbrokers, Weco Shipping (Weco). He also held other positions in shipping related areas. He resigned his executive position in Dannebrog in 1973 when he moved from Copenhagen to Italy. He remained a director of a Dannebrog subsidiary until he resigned in 1976. Since 1974 Hansen has worked as a consultant to various Danish, Swiss and Italian shipping and trading companies and for a period was a director of companies which built a ship in Sweden and four tankers in Yugoslavia. His various activities gave him some experience of the shipping in Australia. In 1968 he managed a small ship fixed on contract to Burma Oil on the north-west shelf and had occasion to visit Perth, Adelaide, Melbourne and Sydney where he made contacts in the shipping trade. In 1969 he opened an office of a Weco subsidiary in Sydney. Between 1969 and 1971 he visited the Australian office from time to time and became acquainted with people in the shipping trade in Australia.
Evans' background was in journalism and publishing. Early in 1973 he became general manager and later managing editor of the Middle East Economic Digest, a London based weekly paper which gave banking, economic, industrial, political and commercial news on events in Middle Eastern countries (except Israel). In 1974 he left the Digest and established an independent commission agency doing similar work on his own behalf. As a result of contacts made through his agency he became interested in the export of live sheep from Australia to the Middle East.
In about May 1975 Hansen became aware of the opportunity to sell sheep to Iran and in about July of that year he was referred to Evans as someone who could arrange the supply of sheep in Australia. A meeting was arranged. In August 1975 the two went to Teheran where they met the chief of the IMO and made an offer to supply 800,000 sheep to the IMO over a two year period.
Towards the end of August 1975 Hansen visited Copenhagen where he met the Baron and told him of the offer that had been made to the IMO. The Baron was not interested unless there was a contract which at that stage there was not. Hansen then made contact with one Koch who was a former fellow apprentice at C K Hansen and who had later worked for C. Clausen Shipping Company (Clausen) which had for some time been engaged in shipping sheep from Australia to the Middle East. Hansen and Koch discussed what was involved in transporting sheep at sea and Koch mentioned a former Clausen employee Bjorn Rasmussen (Rasmussen) as being knowledgable about the relevant regulations. Hansen telephoned Rasmussen and discussed the cost of and time for the conversion of a traditional ship to a sheep carrier. He also spoke to Pedersen, who was then employed by Dannebrog, about the types of vessels used to transport sheep. The possibility of using a tanker was discussed.
In the first half of September 1975, after the IMO advised that their offer had been accepted, Hansen and Evans visited Teheran and executed a contract in the names of their respective companies namely Hamilton Enterprises Inc (Hansen's company) and Normgate Management Limited (Evans' company). Hansen then went to Denmark to arrange the necessary shipping and Evans went to Australia to arrange for the supply of sheep. In Denmark the Baron was unable to provide the necessary tonnage and Hansen thereupon engaged Koch to find suitable shipping. In Australia, Evans found a supplier (Metro Meat Pty Ltd) willing to contract with him and Hansen to supply sheep.
In about mid-October 1975 Hansen met with Evans and one Rossavik, a Hansen employee, in Copenhagen. They met at the office of a firm called Dry Tank which they used as their base for about a week while they endeavoured to arrange shipping for the sheep. Rossavik mentioned seeing many oil tankers laid up in Norwegian fjords. The possibility of converting an oil tanker to a sheep carrier was discussed but Rossavik indicated that it would be too expensive to build decks for the sheep below the weather deck.
Subsequent to the discussions with Rossavik, Hansen and Evans had occasion to drive together to Hansen's home outside Copenhagen where Evans was staying. In the course of the journey Evans raised the possibility of housing sheep in layers of cages or pens placed above the weather deck on a tanker, a proposal that Evans thought would be much easier, quicker and cheaper than building decks below the weather deck. According to Evans, Hansen's response was enthusiastic. Hansen's version is that he immediately saw the advantages of the idea. During the balance of their journey home they discussed various aspects of the idea including the storing of pelletised food and water in the ship's tanks, the stability of the ship, the advantages for ventilation and lighting and the relatively large number of sheep that could be accommodated.
On arrival at his home, Hansen made telephone calls to Rossavik, Rasmussen and a naval architect in Stavanger, Norway one Hagen with whom he discussed the ideas that had been developed during the journey from Copenhagen. Hansen already knew of the tanker Tindfonn which he considered suitable for conversion. Its owners were located at Stavanger and he engaged Hagen to prepare plans and specifications for its conversion to a sheep carrier. As Hagen had no experience in the carriage of livestock at sea, Hansen also engaged Rasmussen as a consultant to assist him.
In November 1975 Hansen, Hagen and Rossavik went to Hamburg, Germany, where Blohm & Voss Shipyard was engaged to calculate the steel weights and other constructional items for the conversion of Tindfonn to a sheep carrier. Hagen later prepared final specifications for the conversion which incorporated the calculations provided by Blohm & Voss. When the specifications were complete, Hansen contacted the Mitsubishi Shipyard in Japan and a few days later representatives of Mitsubishi arrived in Copenhagen. Within a few days Mitsubishi provided a price for the conversion.
At about the same time, Hansen took details of the proposed conversion to his patent agents in Copenhagen and on 28 November 1975 a patent application was filed in Hansen's name.
Hansen's next task was to find someone to purchase and convert Tindfonn. Koch was engaged for this purpose. By December 1975 a shipowner, Hamburg South America (which in Australia used the name Columbus Line) (Hamburg) had agreed to purchase Tindfonn. Hamburg negotiated the conversion contract with Mitsubishi. The ship was registered in Singapore and renamed Atlas Pioneer. Hamilton Enterprises concluded a freight contract with Hamburg.
In the second half of January 1976 Hansen and Evans visited Australia where they met with Metro Meats and visited various ports. They were told by one Lambert (a Columbus Line employee) that he had presented detailed plans of Atlas Pioneer to the Department of Transport in late December 1975, and that the department had given its approval.
Conversion of Tindfonn commenced at Kobe Japan on 10 February 1976. In the second half of March 1976 she left Kobe in ballast for Port Adelaide where she arrived on 10 April 1976 and took on a load of about 50,000 live sheep. After 3 or 4 days in port, Atlas Pioneer sailed for Bandar Shahpur, Iran, (now known as Bandar Mahshare) where she arrived on 7 May 1976. Her cargo was discharged within three days.
Hansen's Danish patent application was refused but later a British patent was granted and this was subsequently registered in Singapore and Hong Kong. The Australian patent application was made on 17 September 1976. It was opposed by Evans and by Dannebrog.
Evans claimed that he had been involved in the invention. He said he had been promised a share in any profits to be made from the invention and he considered that no proper arrangements had been made with Hansen to reflect the contribution he had made, particularly the fact that he had first suggested the possibility of erecting a pen superstructure for sheep on the weather deck of a tanker.
Dannebrog claimed that the invention belonged to it. It was said that Pedersen was the inventor.
The dispute with Evans was resolved by the formation of the applicant company in which Evans became a shareholder. The patent which was subsequently issued to Hansen was transferred to the applicant. The dispute with Dannebrog was also settled. Dannebrog withdrew its opposition and was granted a royalty free licence.
Rasmussen, who gave evidence on behalf of the respondent, had a somewhat different recollection to that of Hansen and Evans.
Rasmussen is now retired. For most of his working life he worked with
ocean-going vessels. He was for 23
years a superintendent employed by Dannebrog and from about January 1968 to
June 1975 he was a superintendent with Clausen. In the latter capacity he participated in
negotiations with the transport departments of several countries to obtain
approval for the conversion of various types of vessels into livestock
carriers. For a period (1969-1970) he
was a member of the
Danish Committee attached to the European Commission on the Transport of Live
Animals.
In the mid-1960's Clausen initiated the large scale transport of sheep by ship in a joint venture with a Kuwaiti company (Homaizi). The trade was mainly on the Australia/Kuwait run. In the late 1960's Rasmussen had participated in the conversion of two passenger ships in Argentina in a joint venture between Clausen and an Argentinian company. The converted vessels, Petrel and Cormoran, regularly carried sheep between Australia and South America to the Persian Gulf. Rasmussen had assisted the naval architect involved in the conversion to ensure that Petrel complied with Australian Department of Transport requirements.
In the period late 1969 to early 1970 a Clausen ship Linda Clausen (ex Kambodia) was converted to a sheep carrier in Sweden. She first sailed to Australia in March 1970 and was regularly engaged on the run between Australia and Bandar Shahpur.
Rasmussen recalled that in late May or early June 1970
he attended a meeting aboard Linda
Clausen at Abadan, Iran. Others
present were Christian Clausen (the principal of Clausen), Captain Pearce
(representing the Clausen/Homaizi joint venture), and an Australian whose
identity he could not recall. The
purpose of the meeting was to discuss a proposal
made by Pearce to convert an oil tanker into a livestock carrier.
Apart from Rasmussen's evidence (which is summarised below) no evidence is available concerning this meeting as the only two known participants, other than Rasmussen, are now deceased. Rasmussen says that Pearce made a rough sketch showing a superstructure of about five levels for the carriage of sheep mounted above the main deck of a tanker extending from the bridge to the engine-room (I understand from this evidence that the sketch would have depicted a "3 island" tanker with the bridge amidships and the sheephouse superstructure aft of the bridge). The sketch also showed that feed and water would be carried in several tanks below deck. The remaining tanks were to be used for oil cargo. Pearce's idea, it was said, was to carry oil from the Persian Gulf to Australia and sheep on the return voyage. It was concluded that the idea was not feasible mainly due to the large loss of time that would be involved in cleaning the ship before the next cargo could be loaded. The proposal was put aside but continued to be discussed by Rasmussen's colleagues at Clausen and others.
Rasmussen also recalled that in late August 1975 he was contacted by Koch who told him that he may soon hear from Hansen in relation to the conversion of a ship for the carriage of livestock. Hansen did in fact telephone him in late August or early September 1975 and asked for general assistance concerning the cost of conversion. No specific type of vessel was mentioned. In the course of several telephone conversations he and Hansen discussed the typical cost of conversion of a ship to enable it to carry livestock both above and below deck but Rasmussen was unable to be very precise in his advice without knowing the type of vessel under consideration. Rasmussen later received a further call from Hansen when he (Hansen) asked him to a meeting at the office of Dry Tank. Rasmussen places the time of this call subsequent to 18 October 1975 (He says he remarried on that day and the call was received after the wedding). In any event, a few days after Hansen's call, in either late October or early November 1975 he met Hansen at Dry Tank. Koch was also there. Evans may have been there but he could not recall. Hansen told him that he was thinking of converting an oil tanker. Rasmussen says that his response was that he thought it was a splendid idea as he had worked on a similar proposal at Clausen a few years earlier. (In his evidence he says that Koch had worked on the calculations that were made at the time but the evidence does not suggest that Koch made any response in relation to the proposal). At the meeting, which lasted two or three hours, Koch, Hansen and Rasmussen had a general discussion about the idea during which Rasmussen made a number of suggestions relating to the construction of the sheephouse superstructure.
In the weeks following the meeting at Dry Tank, Rasmussen received a number of telephone calls from both Hansen and Rossavik but he has no clear recollection of them other than that he was asked to meet with Hagen, who was coming from Norway to Copenhagen and assist in relation to the regulatory requirements for the carriage of sheep at sea. This he agreed to do and he was retained for that purpose on a commercial basis.
In late November or early December 1975 he had a conversation with Hansen which he thinks occurred in the office of Dry Tank. Hansen told him that he (Hansen) intended to take out patent rights in relation to the conversion of an oil tanker to a live sheep carrier. In his affidavit Rasmussen says that he responded to Hansen to the following effect:
You can spare yourself the trouble because it is not your idea. There is nothing new in such a conversion which could justify a patent. If there is to be any patent it should be given to me or to Captain Pearce because Captain Pearce made a sketch of a converted tanker back in 1969.
He says that Hansen did not answer.
In November and December 1975 Rasmussen met with Hagen on several occasions and gave advice on the construction of the sheep pens and other matters. In January 1976 he travelled to Kobe with Hagen to discuss the construction of the sheephouse and then went to Melbourne with a Mitsubishi representative to have the plans for Atlas Pioneer approved by the Department of Transport.
Reference has been made earlier to Evans' visit to Copenhagen in October 1975 when efforts were being made to arrange tonnage for the carriage of the sheep they had contracted to supply. Evans says that on the day after his arrival Rasmussen arrived. He understood that Hansen had requested Rasmussen to give advice about the carriage of sheep at sea. The discussion centred around the relevant Australian regulations. Evans does not recall discussing alternative types of vessels nor any mention of a tanker being used. He says that Rasmussen made no mention of having previously explored the concept of converting a tanker nor did he mention Captain Pearce.
Rasmussen's evidence concerning the comment he says he made in relation to the proposal to obtain patent rights was unconvincing and I reject it as probative of the facts asserted. Having raised the matter of the meeting aboard Linda Clausen in his first affidavit sworn on 19 May 1994 under the general heading "Oil Tanker Conversion" without making any reference to the purported conversation with Hansen in November/December 1975, his subsequent reference to the latter conversation in an affidavit sworn on 27 September 1995 (some 10 days after the commencement of the trial) called for some plausible explanation, which was not forthcoming. And what Rasmussen says he said at the time does not make sense. Under no circumstances does his earlier evidence support a claim that he was the inventor as he claims he asserted to be. Furthermore, he worked in close conjunction with Hansen in the period that the conversion of Tindfonn was being planned and put into effect but apparently never raised the matter again.
Hansen and Evans were both impressive witnesses. There was very little conflict between their respective testimonies. Hansen had extensive experience in the shipping trade and although he was not qualified as a naval architect or engineer his experience undoubtedly gave him a sound understanding of the practical management of ships engaged in international trade. Evans on the other hand had no shipping experience. He was initially rather tentative in suggesting that a sheephouse superstructure might be erected on the deck of a tanker but having put the suggestion it was Hansen who was able to assess the real potential of the idea, provided that other matters such as stability, the provision of feed and water and compliance with relevant Australian regulations could be satisfactorily accommodated. The evidence in relation to Hansen's activities after Evans' suggestion was first made demonstrates that it was Hansen who thought through, with the assistance of the several experts engaged for the purpose, all of the implications involved in the successful conversation of a tanker to a sheep carrier. Whilst it is true that Evans made an initial contribution by raising the possibility of building the sheephouse above deck, it was Hansen who developed the total concept which ultimately found expression in the Danish patent application made on 28 November 1975.
I am satisfied that there is no substance in the suggestion that Evans was a co-inventor with Hansen. The subsequent settlement of the dispute which arose between them when Evans objected to the granting of the Australian patent to Hansen can be explained on commercial grounds and does not in my opinion in any way amount to a concession by Hansen that he was not the sole inventor.
PEDERSEN'S STORY
Pedersen joined Dannebrog as a deck cadet in 1955. He remained with the company until 1984 by which time he was managing director. His last commission as a ship's master concluded in August 1970 after which he took up a position in the broking department of the firm's tanker and dry cargo division. In the same year he was given responsibility for the management of the operation and crew departments and in mid-1973 he was appointed technical manager with responsibility for the maintenance, conversion, proposed conversion, dry docking, crewing and insurance of the company's fleet of two 20,000 tdw chemical carriers, three bitumen carriers, two small tankers, a 20,000 tdw tanker and a small container carrier. At the same time Weco also owned or controlled three small tankers, one of which was placed under his management responsibility. At this time Dannebrog had no involvement in the transportation of livestock.
In or about 1972 a company known as Aries Shipping (Singapore) Pty Ltd had purchased two identical small general cargo vessels which in 1972 and 1973 were converted to livestock carriers with a capacity of 10,500 sheep each. After conversion the ships were named Ariane and Aurore respectively. Most of the sheep they transported were housed below deck but above deck there were two tiers of pens which ran on either side of the weather deck. Early in 1975 following negotiations between the owners and Weco concerning the possibility of Weco taking over management of the vessels, Pedersen went to Bandar Shahpur where he inspected one of the converted Aries ships. In his affidavit he said that he inspected Ariane but other evidence suggests that it must have been Aurore. Pedersen conceded that his affidavit was in error. This error was used as part of an attack on his credit but I am satisfied that the error was innocent and that he did in fact go to Bandar Shahpur in 1975 to inspect Aurore. He says that at the time he was there he saw another livestock carrier Farid Fares in port which he was able to board and inspect. Farid Fares had a multistorey sheephouse erected on part of the deck. (Although it is not referred to in Pedersen's affidavit, the evidence is that Farid Fares also housed sheep below deck). Pedersen's recollection is that the sheep were fed on a combination of hay and pellets and that in some cases the pellets were delivered to each confinement pen manually by wheelbarrow whereas others were delivered by chutes from day tanks located at the top of the sheephouse. The sheephouse had open sides.
In 1975 Dannebrog's two small tankers Billesborg and Brattingsborg (the B vessels) were engaged on lucrative but short term and extremely hazardous charters in Angola where a state of civil war prevailed. In the event that those charters should come to an end, the state of the tanker market was such that it would be difficult to obtain alternative work for the vessels. In these circumstances, Pedersen says that it occurred to him that the tankers could possibly be converted to livestock carriers either to replace Ariane and Aurore or in addition to them. His evidence is that upon his return to Copenhagen in mid-May 1975 he discussed this concept with a number of subordinate Dannebrog personnel as well as with the major shareholders, the Baron and Hansen. He obtained a general arrangement plan of the B vessels and hung it on the wall of his office. Between mid-June 1975 and July/August 1975 he discussed with various people who came into his office various potential configurations of the vessels to facilitate their conversion from the carriage of oil to the carriage of livestock. At that time Hansen still had an office in the Dannebrog building and frequently visited his (Pedersen's) office where they occasionally discussed the concept of converting an oil tanker for the carriage of livestock by reference to the plan of the B vessels he had on his wall. Pedersen says that Hansen made no contribution which advanced the concept. A naval architect was engaged by Dannebrog to prepare calculations as to the stability of the B vessels in the event of them being converted to sheep carriers. The calculations which were received before the end of August 1975 demonstrated that the concept was feasible from a stability point of view.
In about June or July 1975 there were discussions between Dannebrog and the Perth based company Wesfarmers concerning the provision of a third vessel for charter by Wesfarmers for the transportation of sheep. (Other evidence indicates that Ariane and Aurore were already on charter to Wesfarmers). Wesfarmers' London manager, Jack Smith, told Pedersen that the company was very sceptical about the concept of converting tankers for the carriage of livestock and accordingly Pedersen set about acquiring a liner for conversion.
Weco's Hong Kong subsidiary assumed responsibility for
Ariane and Aurore in late September 1975.
Arrangements were made for both vessels to go into dry dock at
Sembawang, Singapore, for maintenance work.
On about 12 October 1975 Pedersen flew to Singapore where he met, by
arrangement, Captain Derek Bowden (Bowden), and his assistant Ian Howie, both
Wesfarmers employees. The purpose of
the meeting was to inspect the vessels and to discuss the possible extension of
the charter and other matters relating to the operation of the ships. In the course of their discussions, Pedersen
says he raised with Bowden the concept of utilising surplus tankers for
conversion into livestock carriers by the construction of a superstructure
above the deck of the tanker. Bowden
said that he had established a good relationship with Captain Johnson, an
officer of the Australian Department of Transport with responsibility for
livestock carriers and undertook to contact Johnson and arrange a meeting early
in November 1975.
The arrangements were duly made and a meeting took place in Melbourne on 7
November 1975. (As there is some
controversy as to who were present at the meeting on 7 November 1975 and as to
what was discussed, I propose to deal with the whole matter of the meeting and
the parties' subsequent involvement in a discrete part of these reasons).
Ultimately, a small tanker owned by Dannebrog, Dansborg, and another acquired by it, Rosborg, were converted to livestock carriers and were chartered by Weco to AustIran Pty Ltd (AustIran), a joint venture involving Australian and Iranian interests engaged in the export of live sheep from Australia to Iran. These conversions took place in the latter part of 1976.
It is appropriate here to refer briefly to Bowden's evidence. Bowden, who retired in 1991, was formerly the shipping manager of Wesfarmers and other associated companies. He was based in Fremantle. Some of his evidence concerning the live sheep trade out of Fremantle in the period prior to 1974 is incorporated in the background information set out earlier in these reasons. He and Pedersen first met during the dry dock refit of Ariane and Aurore in Singapore in mid-October 1975. It was during this visit to Singapore that Pedersen first mentioned to him the concept of Dannebrog converting an oil tanker into a live sheep carrier. A few weeks earlier the same idea had been mentioned to him by one Colin Bayly. Upon returning to Australia on 22 October 1975, he telephoned Johnson and told him in confidence of Pedersen's concept and made an appointment for Pedersen and himself to meet on 7 November 1975. The primary purpose of the meeting was to discuss a number of matters relating to Ariane and Aurore.
THE MEETING ON 7 NOVEMBER 1975
I propose first to quote extensively from the relevant affidavit material and then to refer to the cross-examination of the respective witnesses.
In his affidavit sworn 30 March 1994 Pedersen said (in paragraphs 38 to 42):
38. On the 7th November Captain Bowden and I attended at the office of the Department of Transport in Elizabeth Street and met with Captain Johnson. I believe that during that visit I met Captain Synnott but I cannot recall whether he was also present during all or part of the meeting.
39. My primary objective in this meeting was to introduce Dannebrog to Captain Johnson and explain to him the nature, operations and operative philosophy of the company and of its associated company Weco, to discuss with him the Department's requirements and concepts for the livestock trade, to discuss with him Dannebrog's existing operations, the maintenance work being performed on the "Ariane" and the "Aurore" and the concept which Dannebrog was developing for its future participation in the transportation of livestock from Australia to the Middle East. In the context of discussing these future concepts I raised with Captain Johnson my concept of converting a tanker to a livestock carrier.
40. I discussed with him the prospect of constructing a multi-storey superstructure on the deck of the tanker and utilising some of the tanker's storage tanks for water and feed. I discussed with him the possibility of utilising the tanker for a two way trade. Captain Johnson emphasised the importance in any two way trade of ensuring that the tanker was properly degassed on each occasion that it re-entered Australian waters to collect livestock.
41. It soon became apparent to me that of the
problems of presenting a dirty tanker in the Middle East which had been
carrying livestock for two or three weeks to collect oil together with the
problems of de-gassing the tanker before re-entering Australian waters would be
likely to render a dual trade uneconomic.
I became aware from my discussions with Captain Johnson of the very
tight
regulation of the Department of Transport of tankers and of livestock carriers
and of the extent to which it would be difficult to meet all these regulations
if a ship was to (sic) utilised for both purposes either concurrently or
alternately.
42. Accordingly, when Dannebrog ultimately converted the "Dansborg" it abandoned the concept of using the ship for dual trade.
Bowden dealt with the meeting fairly briefly in his affidavit of 9 March 1994 (paragraphs 12 to 14) as follows:
12. On 7 November, 1975, I visited Captain Johnson in Melbourne. I was accompanied by Captain Pedersen. I believe that Captain Synnott was also present. The primary purpose of our visit was to discuss the maintenance of Dannebrog's existing two livestock carriers, "Ariane" and "Aurore". At the meeting we discussed the renovation of the pen structures on the "Ariane" and the "Aurore" and the provision of additional ventilation in both these ships. We also discussed the proposed conversion by Dannebrog of an oil tanker for the carriage of livestock. The concept was only discussed with Captain Johnson in fairly general terms. We did discuss however, the concept of a tiered super structure being erected on the deck of the oil tanker, feeding mechanisms, watering mechanisms and other like matters.
13. Captain Johnson discussed with us the need to ensure that the tanker was gas free.
14. The proposal was left on the basis that Dannebrog would submit a formal proposal to the Department when it was ready to proceed further.
Johnson swore a lengthy affidavit on 14 April 1994. Before referring to the relevant passages it will be appropriate to say something of his background and the position he occupied in 1975.
Johnson first went to sea in 1939 as a deck boy. After serving in various capacities he
obtained his ticket as a Master Foreign-Going in 1951. He left the sea in 1954 and worked in
various related occupations in the UK until 1969 when he joined the Australian
Department of Transport as a marine surveyor.
Following a series of promotions he became
a Principal Surveyor and in the period 1973 to 1978 was in charge of the cargo
section of the department's Marine Survey Branch. His duties included the assessment of
vessels engaged in the export of livestock from Australia for compliance with
regulations made pursuant to the Navigation Act. In particular, his duties involved assessing
proposals for the conversion of vessels for the carriage of livestock.
In paragraphs 40 - 42 (inclusive) of his affidavit, under the heading "Proposals to convert oil tankers before 28 November 1975" Johnson deposed as follows:
40 On 7 November 1975 I recall that Captain Ole Pedersen of Dannebrog Rederi ("Dannebrog"), a Danish shipping company, attended my office together with Derek Bowden of Wesfarmers, Dannebrog's Australian agents. Towards the end of our meeting, Mr Pedersen said that Dannebrog proposed to convert an oil tanker into a live sheep carrier. He said that the proposal was to provide a structure secured to the tanker deck which would consist of several decks of sheep pens in two tiers. He said that the pens would be of tubular steel in conformity with the existing Specifications. Captain Pedersen said the intention was to use the ship's tanks for the storage of feed and water for the animals as well as to ballast and that a mechanical feed distribution system would also be used. Captain Pedersen said that the vessel would be dedicated to the carriage of livestock, that all tanks would be cleaned and gas-freed, and hatch coamings and other structures on the tanker deck would be removed. We discussed the several issues, particularly those relating to safety, which I felt were involved in the conversion of an oil tanker to a live sheep carrier, and also the carriage of live sheep on the vessel itself.
I said that gas-freeing the vessel was an important safety matter. This involves washing out the tanks with hot water and detergents to remove any residues of oil which would otherwise exude flammable gas and then allowing the tanks to ventilate for several days before testing them with a flammable gas meter. The operation normally takes about one week.
41. Mr Pedersen said that when Dannebrog was in a position to proceed it would submit definite proposals to the Department for consideration. At that time persons seeking Departmental approval for live sheep carriers had freely available to them a document prepared by the Department entitled "Draft Requirements for the Carriage of Livestock by Sea". Now produced and shown to me and marked "GCJ9" is a true copy of that document. A copy of the document was given to Captain Pedersen by me.
42. I had some forewarning of the approach referred to in the previous paragraph relating to the conversion of an oil tanker by a telephone conversation with Derek Bowden of Wesfarmers a few weeks prior to the meeting.
The only other witness whose evidence has a bearing upon the meeting of 7 November 1975 is Captain Andrew Synnott who is mentioned in the affidavits of both Pedersen and Bowden. In November 1975 Synnott was a Senior Marine Surveyor in the Marine Standards Division of the Department of Transport. In his position he had two roles. He was relieving Senior Surveyor at certain ports and he performed various duties in the Cargo Handling Section of the Marine Standards Division. In the latter role he dealt with people proposing to convert vessels for the carriage of livestock from Australia. In his affidavit sworn 14 April 1994 Synnott makes no reference to the meeting of 7 November 1975 nor to any dealings with or communications from either Pedersen or Bowden. Nor does he make reference to any conversations with Johnson concerning the meeting.
Before dealing with the cross-examination relating to the meeting of 7 November 1975 reference should be made to the affidavit evidence of both Johnson and Synnott relating to an approach made to the Department in November 1975 concerning the conversion of an oil tanker for the carriage of sheep. Johnson deals with the matter at paragraphs 45 to 48 (inclusive) thus:
45. Very shortly before 28 November 1975 and after my meeting with Ole Pedersen and Derek Bowden on 7 November 1975 I recall that there was another approach to the Department about a proposal to convert an oil tanker to a live sheep carrier.
46. Now produced and shown to me and marked "GCJ11" is a group of documents which are true copies of documents which I am able to identify as documents from the Department's files.
47. These documents relate to the proposal which I refer to in paragraph 45 hereof. I saw these documents at or about the time they came into existence and I discussed the proposal with Andrew Synnott, another marine surveyor in the Department. The proposal was to convert an oil tanker to a live sheep carrier by fitting 5 tiers of livestock pens on the deck of a 50,000 tons dead weight oil tanker for the carriage of sheep between Australia and the Persian Gulf. The proposal generated some considerable debate within the Department which I recall and which is apparent from the exhibited documents.
48. By reason of my conversations with Ole Pedersen and Derek Bowden on 7 November 1975 and my awareness of the subsequent proposal referred to in paragraph 45 hereof and the controversy generated within the Department consequent upon that proposal, I am able to say that prior to 28 November 1975 the concept of converting an oil tanker to a live sheep carrier was well known to me.
Synnott deals with the same subject in more detail at paragraphs 4 to 9 (inclusive) in these terms:
4. Now produced and shown to me and market "ATS1" is a bundle of documents numbered 1 to 10 which I can identify as copies of documents from the Department's files created in the ordinary course of the Department's work. I remember having seen all of these documents on or about the date they were created. The first of these documents is a telex dated 12 November 1975 directed to the Chief Marine Surveyor. I remember having previously read this document on or about the date it was produced. The matters raised in this document gave rise to me preparing a report dated 17 November 1975 which is referred to below. In relevant part, that telex states as follows:
"1. Messrs Mitsubishi Kobe shipyard intend to offer a tender for conversion work of 50,000 DWT type oil tanker into sheep carrier for Australian owners.
2. New 5 tiers deck house is to be fitted on upper deck between existing midship bridge and poop for carriage of sheep as deck cargo.
Owners require ship to comply with requirements of Australian regulations.
Builders have no knowledge on applicable statutory requirements of Australian authorities in this case.
3. As no information is available in this office either, please advise Australian regulations to be applicable in this case.
4. As builders wish to receive our urgent reply, your prompt attention on this matter would be much appreciated.
Last - LRSYD"
5. The letters "LRSYD" indicate that telex came from the Sydney office of Lloyds Register. Lloyds Register is one of the leading classification societies in the maritime world.
6. The second document in the bundle is a response from the Chief Marine Surveyor, Mr Ron Elliott, indicating, inter alia, that the Department's initial reaction to the proposal was unfavourable. Once again, I remember having previously read this document on or about the date it was produced. It was also a document to which I had reference in the preparation of my report.
7. The fourth document in the bundle is a telex sent on 13 November 1975 from Mr Elliott to the First Assistant Secretary, Sea Transport Policy Division of the Department in Canberra. I remember having seen this document on or about 13 November 1975. Point 4 of the document refers to an investigation of safety aspects of the proposal. I carried out this investigation. It will be seen from point 7 of that telex message that Mr Elliott believed that what was being proposed was to use an oil tanker to transport crude oil from the Persian Gulf to Australia and livestock back from Fremantle, Adelaide or Geelong. As appears from paragraph 9 of the telex, Mr Elliott sought the views of the Sea Transport Policy Division on the proposed oil tanker conversion.
8. Document number 5 is a further telex from Mr Elliott in which he also sought the views of the Assistant Secretary of the Meat Division of the Department of Agriculture in relation to the oil tanker conversion proposal. I previously saw the document on or about the date it was created. All of these documents were inter-related and all of them record file No 75/4297 which was a livestock conversion file kept by me.
9. I was well aware of the proposal to convert an oil tanker for the carriage of livestock which was the subject matter of the documents. On 17 November 1975 I prepared a minute paper for the Chief Marine Surveyor on the proposal. That minute paper is document number 7 in the bundle. It bears my signature. I also spoke to Captain Geoff Johnson about the proposal. Captain Johnson was also a Marine Surveyor with the Department.
The cross-examination of Johnson was both long and
searching. The witness was tested on many matters which related to events
nearly 20 years earlier in respect of which no contemporary record was
available to refresh his memory.
Understandably he was at times uncertain as to some details and it would
be expected that his evidence may contain some inconsistencies. But the nature and extent of the
inconsistencies in his evidence as revealed by the cross-examination are such
that I
am of the opinion that his evidence concerning what occurred at the meeting of
7 November 1975 should be accorded no weight.
It is clear that in 1976 Johnson had dealings with Pedersen concerning
the conversion of Dansborg and it is
equally clear that he has confused some aspects of his subsequent dealings with
the initial meeting on 7 November 1975.
From the affidavit evidence of both Pedersen and Bowden and in cross-examination (Pedersen at T 288, 300, Bowden at T 381) it is clear that Pedersen had not met Johnson prior to 7 November 1975 and yet when asked to explain why it was that he dealt with Pedersen in November 1975 (when there was evidence that he was then engaged on other duties) rather than to refer him to someone else in the department Johnson said:
I was available to discuss the matter with him, because I new the ships he was concerned about, "The Ariane" and "The Aurore". I had been to Singapore and seen them and saw the condition in which they were at that time and also I knew him and he knew me and he asked to see me and I saw him. (T 181).
The transcript then records the following exchange between counsel and the witness:
But you were too busy otherwise writing reports to participate to any significant degree in the discussion, or debate? ... Yes, that's right.
That followed upon the matters referred to in exhibit 11? ... That all happened without my participation.
If you were too busy, Mr Johnson, would it not provide all the more reason to provide a file note of any significant matters of discussion, so that others in the Department who would have to have the conduct of such a matter would know what discussions had occurred between you and Mr Pedersen? ... In a small office, when one knows one's colleagues and you continually discuss matters of safety with them, I saw no need to enlarge on it by making a file note.
How well did you know Mr Pedersen as at November 1975? ... Fairly well as a person, but not anything to do with his background or anything like that.
How many times had you previously met him? ... Half a dozen, I suppose.
And did you regard him as a friend? ... An acquaintance, a respected acquaintance.
Not only is this evidence wrong, it displays the fundamental confusion that pervades many aspects of the testimony. I accept that Pedersen and Bowden met with Johnson on 7 November 1975 and that they discussed matters relating to Ariane and Aurore but I do not accept as probative any evidence of Johnson as to any other matter discussed on that occasion. His evidence is too unreliable to have any weight. For the same reason I do not accept that correspondence that emanated from Johnson in 1976 in which he purported to recount what had been discussed on 7 November 1975 is either accurate or of any probative value in this proceeding.
Pedersen was also subjected to searching cross-examination relating both to the matters in issue in the proceeding and on other matters which touched upon his credit generally. He was put forward by the respondent as a person who had invented the invention the subject of the patent. Indeed, he would have it that it was following his disclosure to Hansen of the concept that Hansen had taken and used the idea in relation to the conversion of Atlas Pioneer. The meeting with Johnson on 7 November 1975 was part of the evidence which was relied upon to establish that prior to the 28 November 1975 (the priority date referred to in the patent) not only had the invention been thought of by Pedersen, but it had also been fully discussed by him in a number of quarters.
When pressed as to whether Johnson's subsequent recollection of what was discussed at the meeting on 7 November 1975 was mistaken, Pedersen responded:
I don't know whether he made a mistake, unfortunately, I can say as much that we discussed the general concept of using a tanker as a sheep carrier when we met in his office and the kind of problems which were involved with that. The gas freeing, the practical cleaning of the pens, the still using the vessel as a tanker at the same time it as a sheep carrier, the dual purpose carrier, that was the main consideration during that meeting - how to use a tanker still being a tanker as also a livestock carrier. With all the practical difficulties that would involve, I was fairly convinced after the meeting that this was not possible. (T 309)
Bowden's recollection as recorded in paragraphs 12 and 13 of his affidavit quoted above is somewhat more precise but when asked in cross-examination his recollection of what Pedersen said on the topic of tanker conversion he said:
He told them that his company were contemplating converting an oil tanker to become a live sheep carrier. I can remember Captain Johnson saying that the vessel must be guest(sic)-free. I believe he suggested that the tanks must be sand-blasted, the hatch combings for the tank lids were to be removed, and under no circumstances was the vessel to carry petroleum products as well as sheep. (T 383)
This recollection is in sharp distinction from the detail recorded in paragraph 12 of his affidavit where reference is made to the concept of a tiered superstructure on the deck of the tanker and feeding and watering mechanisms.
Bowden was fairly confident that Synnott was present
at the meeting (T 381-2); Pedersen was
not sure (affidavit 30 March 1994, para. 38);
Johnson made no mention of Synnott being present and there
is a clear inference from his assertion at T 162 that he told Synnott
about Pedersen's ideas shortly after their meeting that he did not recall
Synnott being present. Synnott makes no
mention of the meeting or of any
conversation with Johnson about the meeting and this is notwithstanding that
there is clear evidence, which I accept, that Synnott had lunch with Johnson,
Pedersen and Bowden after the meeting on 7 November 1975. It is beyond belief that if the subject of
converting a tanker had been discussed at the meeting (and assuming Synnott's
absence) that the same parties would have had lunch together straight after the
meeting and not mentioned the matter to Synnott.
The weight of the evidence is that Synnott was not present on 7 November 1995 notwithstanding that Bowden was "pretty sure" that he was there and that he "was generally at meetings" (T 381). This leads to the question of whether Bowden has confused the meeting of 7 November 1975 with other meetings involving Johnson and Pedersen. A similar question is raised by the references in the evidence of both Johnson and Bowden that at the meeting Pedersen said that his company was considering the conversion of an oil tanker to a live sheep carrier. I am satisfied from the evidence that at 7 November 1995 Dannebrog was not actively considering the conversion of an oil tanker to a sheep carrier. Its two B vessels were by then chartered as oil tankers and in any event their size was such that they could not sensibly be thought suitable for use in the then expanding sheep trade from Australia to the Middle East which must has been the trade that was being contemplated if the prospect of dual use was under consideration. Pedersen and Bowden had already in October 1975 considered the prospect of increasing the carrying capacity of Ariane and Aurore (Bowden at T 377) which were much larger ships than the B vessels and I simply do not believe that in November 1975 the question of converting those ships to sheep carriers for the Australia-Middle East trade was under consideration.
It is the fact that in 1976 Dannebrog did contemplate the conversion of a tanker and did in fact convert Dansborg. Bowden, as an employee of Wesfarmers, was aware of, and actively concerned in the conversion of Dansborg and it is probably the case that he has confused later discussions with those which occurred on 7 November 1975. I think that on the evidence before the Court, it is more probable than not that the question of converting an oil tanker was not discussed on 7 November 1975.
This conclusion is supported by the evidence relating
to the telex received by the department from the Sydney office of Lloyds
Register on 12 November 1975, which Johnson says he became aware of shortly
after its receipt. It is difficult to
believe that had the very same subject matter been raised with him by Pedersen
on 7 November 1975 he would not have mentioned it to someone within the
department following the Lloyds telex, particularly as the initial responses
made by the department contemplated that dual use was being considered. If Johnson had within a week earlier formed
such a firm view about dual use as his evidence suggests, it is inconceivable
that he would not have raised the matter with
one or other of the officers who were dealing with the enquiry.
The settlement reached between Hansen and Dannebrog in relation to Dannebrog's objection to Hansen's Australian patent application is readily explained both on commercial grounds as well as indicative of the long association Hansen had with Dannebrog. The settlement cannot be construed as a concession that Pedersen played any part in the invention.
BURBURY'S STORY
Christopher Burbury resides in Western Australia and follows the occupation of export market consultant. His early background was in Tasmania where he was brought up on his family's sheep farm. He moved to Kojonup in WA in 1961 to manage a sheep farm belonging to his family. By 1969 the Kojonup property of 6,000 acres was carrying 21,000 sheep.
In the early part of 1969 Burbury was invited by one Roberts to participate in a live sheep shipping venture he was then seeking to establish. Roberts said that the proposed venture involved the conversion of a passenger ship in Germany to carry live sheep from Australia to Kuwait. Roberts asked Burbury to supply sheep for the venture which he agreed to do. As it happened nothing came of this venture.
In about April 1972 Burbury was introduced to George Villegas of the Argentinian company Transportes Oceanicos which owned two converted passenger liners, Petrel and Cormoran, (to which reference is made earlier in these reasons) which were used to carry about 22,000 sheep. The introduction was made by Peter Arnold, an acquaintance of Burbury's who was the veterinarian employed on Petrel. After some preliminary discussions including making an inspection of Petrel in June 1972 Burbury commenced to load sheep onto Petrel but only succeeded in loading 2,000 head before the company went into receivership. As a result he was unable to ship a full load.
At about this time Burbury had a number of concerns in relation to the exporting of live sheep. First, he observed that sheep were normally prepared for export for only about four days during which time they were placed in feed lots, inoculated and fed hay before being loaded onto ships. Burbury formed the view that this process did not properly condition the sheep for the rigours of the sea voyage. He thought, and suggested to Villegas, that the sheep for export by Transportes Oceanicos should be prepared for a period of 2 to 3 weeks on his farm. Villegas agreed. His second matter of concern related to the conditions under which sheep were transported at sea. Poor ventilation caused or contributed to high animal mortality, particularly in the lower decks of converted liner ships. Overcrowding was also a problem as this tended to restrict the access of sheep to feed and water. Third, the then practice of feeding sheep on hay meant that the loading and distribution of feed was labour intensive and that the feed necessarily occupied substantial storage space.
In about July 1972 feeding sheep with chicken pellets was introduced in some feed lots in WA and in some cases chicken pellet feed was introduced on live sheep carriers. Later specific pellets were developed to cater for sheep. Petrel and Cormoran converted from the use of hay to pellets in stages commencing in about the second half of 1972. Initially pellets were stored in bags and were distributed by wheelbarrows to the individual pens. Later bulk handling methods were introduced whereby pellets were loaded by pneumatic systems or blowers into tanks in the hull of the ship and were taken from there by either auger screws or by a pneumatic system to day tanks located either in or above the sheephouse. The pellets were then distributed from the day tanks by pipes to each level of the sheephouse and at an access point on each level wheelbarrows were loaded with pellets for distribution to the pens.
Water was also carried on each vessel or was produced on board using desalination plants. Initially water was provided to the pens in troughs which were filled by hand held hoses. Gradually more advanced water distribution facilities were developed and in at least one case there was a system whereby water was automatically replenished in the troughs as it was consumed. The evidence is unclear as to precisely when this latter development occurred.
Late in 1973 Burbury received a telephone call from one Rachid Fares, a ship owner, who asked him to supply sheep for a livestock carrier he had then recently had converted in Singapore. The vessel, Farid Fares had a carrying capacity of about 32,000 sheep. It had a multistorey sheephouse constructed on the upper deck as well as capacity below deck. Burbury inspected Farid Fares in WA late in October or November in 1973. At the time the Australian government policy was to prohibit the export of live sheep and as a consequence Farid Fares went on to New Zealand to load her first shipment. Later, government policy was changed and Farid Fares commenced carrying live sheep from Australia in or about late 1974.
In May 1974 Burbury became a partner with 3 others in Millendon Stock Company which leased a property near Perth for use as a feed lot. It became one of the largest professional feedlots in Australia. His association with the partnership terminated in 1976 when a conflict of interest arose between his role as a shipper of sheep and that of the feed lot business which was providing services to many competitive shippers.
In about May 1975 Burbury was contacted by a representative of Sheikh Ghyriafi of Damman, Saudi Arabia with a view to him supplying sheep for export to Saudi Arabia. In June 1975, in the company of John McPhee, a partner in Millendon Stock Company, he travelled to Damman to discuss the matter further and sometime later a joint venture was finally commenced.
In July 1975 Burbury became aware of the interest of one Michael Blonksy (who lived in Athens) in contracting for the supply of live sheep from Australia to Libya. He decided to visit Libya and en route had to wait for 3 days in Athens to obtain a visa. Whilst there he met Blonksy and a Libyan named Bughaighis. Bughaighis said that the Libyans were seeking the supply of 840,000 sheep over a 12 month period and would not negotiate for a smaller number. At this stage the largest sheep carrier was Farid Fares which had a capacity of only 32,000. On the day after meeting Bughaighis, Burbury travelled to the port of Pinaeus where he observed a large number of oil tankers which had been laid up. He was told by local shipping people that the oil crisis had made the tankers redundant and they were being sold off for scrap. He says that it immediately occurred to him that if converted into live sheep carriers, the laid up oil tankers would have a much larger carrying capacity than the livestock carriers then available and he commented to Blonksy and another companion who was with him that the conversion of oil tankers would be the answer to the problem of transporting the large numbers of live sheep sought by Bughaighis. He said that his idea was that sheep could be carried on top of the tankers by using the same type of multi-tiered above deck structure he had seen on Farid Fares and that the tanker's storage facilities would provide immense capacity for carrying water and feed for the sheep. Further, he had in mind that the tankers' oil transportation facilities would be left intact with a view first of transporting oil from Saudi Arabia to Australia on the return voyage and second, in case the live sheep trade from Australia was again banned by the government, in which case the sheephouse could be removed and the ship returned to use as a tanker.
In the belief that he would be able to provide adequate shipping for the purpose, Burbury negotiated with the Libyan government for the supply of the number of sheep that were required. Burbury subsequently discussed his concept of converting oil tankers to carry sheep with a number of people including Godfrey Martin of AustIran who was impressed; his partners in Millendon Stock Company who were not interested in being involved in the transportation of sheep; Ian Cox a shipping consultant who said that dual trade would not be feasible; Peter Arnold (the vet) and Jim McManus (Burbury's solicitor) neither of whom apparently made any comment worth recording; Peter Wesley of Wesfarmers who was interested in the prospect of being able to transport increased numbers of sheep in single shipments and Villegas and Rachid Fares who were taken aback by the idea as it was thought that Fares' planned conversion of the liner Persia would be the best livestock conversion in the world.
Wesley and Burbury negotiated for Wesfarmers to provide a letter of intent to supply all of the sheep necessary to fulfil the Libyan quota. Burbury obtained from a shipping agent in Athens the plans of an oil tanker which he took to the Keppel Shipyard in Singapore with whom he discussed a conversion along the lines of Farid Fares. However, the Libyan contract was placed elsewhere and nothing came of Burbury's proposed conversion.
Godfrey Martin, to whom reference is made above, joined AustIran as chief executive in August 1975. The primary objective of AustIran was to enter the live sheep and meat export trade to supply that market in Iran. It was owned as to 50% by two major Iranian government banks and as to 50% by Australian interests.
From the very beginning of his employment with AustIran, Martin was concerned that the contracts issued by the IMO to AustIran far exceeded the carrying capacity of the two vessels then available, namely Ariane and Aurore. After discussions with a variety of people involved in shipping it became apparent to him that it was not possible to enter the livestock shipping business and make a profit unless the vessel used was contracted by the shipper. After discussions with the chairman of AustIran, it was decided that Martin should meet with Wesfarmers and also visit various Asian shipyards in an endeavour to become better informed and capable of defining an appropriate shipping strategy for the company.
Martin's evidence establishes that by mid-September
1975, the concept of converting oil tankers to carry live sheep had been
raised with him. In a report written on
19 September 1975 Martin stated:
Soon after the earlier report was completed, Wesfarmers indicated they had an offer for a `new concept' and indicated price for 60,000 head per voyage at US$20 per head. The promoters spoke in confidence to Mr C. Bayly of Wesfarmers and asked him to respect their confidence and not disclose the concept. This he agreed to do. As the promoters were coming to Australia a meeting was organised in Singapore.
Later in the same report Martin wrote:
The promoters of this new concept are two partners of Millenden, the feedlot we presently use in Western Australia, and an ex Australian (now British subject) with shipping experience living in Athens. I spoke to Mr C. Burbury (Millenden) and Mr M. Blonsky (living in Athens). They intend to put together a company (this area still very vague) and have apparently arranged finance for the scheme. They also are about to get a contract for 1,000,000 sheep per year to Libya and this contract should be signed in 2 weeks' time. They intend to convert vessels to support this contract and would like to also service ours.
In a subsequent report written on 29 September 1975 Martin wrote:
Recent conversions are putting more pens on deck and I understand that it can be proven that sheep losses are much less in pens on deck than in pens below deck. This suggests therefore, that the right kind of vessel might be something like a RORO where all pens could be above the weather deck and general cargo could be carried below deck. As discharge rates for sheep are quite quick, this would now allow a large quantity of general cargo to be handled as priority berthing is only allowed at Bandar Shahpur for sheep movement. As most quarter ramp ROROS are relatively new vessels, the capital cost would certainly make them too expensive for this trade.
A recent suggestion is to put all pens on top of a tanker. This has the advantage of using natural ventilation and is similar to the RORO concept mentioned above. At this point of time, tankers are apparently cheap and a 25,000 ton tanker could be converted to carry some 30,000 sheep. A rough costing of this type of vessel is set out in Appendix A.
Pens 8 feet high each would be built 3 high giving an overall structure of approximately 25 feet. Removable floors would be slotted at 4 feet intervals effectively giving 6 high pens for sheep and 3 high pens for cattle. Suggested size of pens would be 20 feet by 10 feet providing space for 50 sheep with 4 square feet each. This is well within permitted levels of the Commonwealth of Australia Navigation (Deck Cargo and Live Stock) Regulations.
Most of the
present livestock carriers are labour intensive and carry a stockman for each
1200/1500 sheep, so a vessel carrying 30,000 sheep with present feeding
arrangements would need some 20 to 25 additional crew as stockmen. Most vessels today carry fodder in bags but
it is suggested that this should be carried in bulk silos on board. Instead of loading bags of pellets, the
pellets could be blown on. Feeding
arrangements on board could be from the bulk silo to trolleys with dispensing
nozzles to feed troughs on each pen.
Quantity control could be maintained in this way and the number of crew
stockmen reduced.
A tanker has advantages in being able to store fresh water in its tanks so we would not need to worry about water consumption or holding capacity. Considerable pumping capacity is also available to bring water up to outlet points to enable us to give the sheep plenty of drinking water.
A major difficulty on below deck pen accommodation, is the cleaning problem. The droppings and urine problems are immense and even if effective drainage is achieved for urine, the droppings can only be removed by shovel in confined areas. The advantage of above deck pens and plenty of pumping capacity is that much of the cleaning process could be accomplished by hose.
Martin's report of 29 September 1975 is a valuable contemporary record of the idea Burbury was seeking to promote. It is clear that Burbury's concept of the conversion of oil tankers to carry sheep did not involve using the below deck storage tanks to store feed for the sheep. The description of the proposed feed distribution arrangements are quite different from those proposed for water distribution, the latter clearly involving the use of the below deck tanks.
Burbury never did convert an oil tanker to carry
sheep. As a man experienced in dealing
with sheep and in particular being involved in the transportation of sheep by
sea he readily perceived the advantages of converting large vessels such as tankers
to carry substantial numbers of sheep above deck. However, his concept as detailed in Martin's
report of 29 September 1975 did not involve the same combination of ideas later
expressed in Hansen's patent application.
Whilst there is evidence that suggests that Burbury's idea was communicated
to a number of people in about August and September 1975, and that not all of
the communications were on a confidential basis, there is nothing in the
evidence to support a finding
that anything done or said by Burbury or those to whom he disclosed his idea
amounted to a publication prior to 28 November 1975 of the invention disclosed
in the application for the patent in suit.
PATENTS ACT, s 40
It is convenient to deal initially with the issues raised by the respondent in relation to s 40 of the Patents Act. These issues go to the validity of the patent and for the most part can be determined upon a proper construction of the claims and the specification. Except to the extent that the evidence goes to questions relating to the meaning to be ascribed to words having a technical meaning, it is unnecessary to embark upon an exercise in fact finding. In the event that the patent in suit is found to be invalid, the applicant's case will fail.
Section 40 of the 1990 Act provides (to the extent presently relevant):
40. (1) ...
(2) A complete specification must:
(a) describe the invention fully, including the best method known to the applicant of performing the invention; and
(b) where it relates to an application for a standard patent - end with a claim or claims defining the invention; and
(c) ...
(3) The claim or claims must be clear and succinct and fairly based on the matter described in the specification.
(4) ...
(Subsections 40(1) and (2) of the 1952 Act provided to the same effect).
The respondent bases its case upon the following assertions:
(a) There is an insufficient description by the patentee of his invention;
(b) The claims are not fairly based on the body of the specification;
(c) The patentee has failed to describe the best method known to him of performing the invention; and
(d) The claims are neither clear nor succinct.
To sufficiently describe an invention the specification must enable "the reader to discern what was the invention, the total thing that it describes" (Sami S Svendsen Inc v Independent Products Canada Ltd 119 CLR 156 per Kitto J at 165).
A patentee does all that is necessary to comply with the requirement that the specification must describe the invention fully "if he makes the nature of his invention plain to persons having a reasonably competent knowledge of the subject, although from want of skill they could not themselves practically carry out the invention" (Edison & Swan Light Co v Holland 6 RPC 243 at 280, cited with approval by McTiernan J in Samuel Taylor Pty Ltd v S.A. Brush Co Limited 83 CLR 617 at 624).
In AMP Inc v Utilux Pty Ltd 45 ALJR 123 at 131, McTiernan J said:
In practice
this requirement of s 40 (2) [of the 1952 Act, which is equivalent to s 40 (3)
of the 1990 Act] means that if there is some feature claimed in a claim to
which no reference is made in the body of the specification or if a claim is
not limited by its terms to what the patentee has stated in the body of the
specification to be the embodiment of the invention, then the requirement of s
40 (2) has not been complied with. It
follows from my view of the operation of
this provision that an invention may be new and useful and not obvious and yet
a grant of letters patent in respect of that invention may be revoked because
the claims and the body of the specification have not been correctly drafted. Section 40 (2) is concerned with comparing
the statement of that for which the patentee (or more correctly the applicant)
claims a monopoly with his full description of his invention. It is concerned with what is in other fields
referred to as internal consistency.
The question of fair basing was considered by the High Court in Olin Corporation v Super Cartridge Co Pty Ltd 180 CLR 236 in which Barwick CJ said at 240:
The question whether the claim is fairly based is not to be resolved, in my opinion, by considering whether a monopoly in the product would be an undue reward for the disclosure. Rather, the question is a narrow one, namely whether the claim to the product being new, useful and inventive, that is to say, the claim as expressed, travels beyond the matter disclosed in the specification.
Although in the facts of the case Barwick CJ was in the minority in respect of the finding relating to fair basing, his statement of principle is consistent with the views of other members of the Court.
The separate statutory requirements that the specification must describe the invention fully and that the claim or claims must be fairly based on the matter described in the specification are necessarily closely interrelated and it will be convenient to address those issues together. Although it is said that there are several respects in which the invention is not fully described in the specification the respondent places most emphasis on what are perceived to be the defects in relation to the means for conveying feed and of delivering water directly to each confinement pen.
Claim 1 (the Full text of which is set out above) claims, inter alia:
1. An ocean-going ship constructed by conversion of an oil tanker vessel to one for transport of a main cargo of livestock, said vessel comprising a decked hull enclosing a plurality of bulk storage tanks occupying a major proportion of the hull volume; a multi-storeyed superstructure standing up from the deck of the hull and including a plurality of animal confinement pens in each storey; livestock food conveyor means extending from one or more of said storage tanks to said livestock confinement pens whereby livestock food can be bulk stored in said one or more storage containers and conveyed directly therefrom to each of said confinement pens by said food conveyor means; ...
And Claim 2 claims:
2. An ocean-going ship as claimed in claim 1, wherein the food conveyor means and the water conveyor means are comprised of separate pipelines interconnecting the respective storage tanks with said confinement pens and means operable to cause food and water to be conveyed through the respective pipelines to said confinement pens.
At pages 2a - 3 of the specification the invention is described in precisely the same terms as are set out in claims 1 and 2. At page 6, the specification states:
The supply of food and water from the storage tanks to the pens and the removal of manure from the pens can be effected by an convenient conveyor means. By way of example there is schematically shown in Fig. 3 a dispensing container 22 communicating with a conduit within a hollow lid in a pneumatic conveyor system for supplying food pellets from a storage tank to the dispensing container. There may be one or more such containers in each storey for supplying a suitable number of pens. Similarly, there may be water taps 21 communicating with water conduits within the hollow posts llc for supplying drinking water from water tanks to the pens.
(It is common to the parties that there are two typographical errors in the passage just quoted. In the third line "an" should be read either as "a" or "any" and in the sixth line "hollow lid" should read "hollow lld" being a reference to a hollow column identified in Fig 3 as 11d).
As a matter of construction of the words used it is
clear that the references to "one or more of said storage tanks",
"one or more storage containers" and "the respective storage
tanks" in claims 1 and 2 and the words "the storage tanks" and
"a storage tank" in the extract from the specification refer in
each case to the "plurality of bulk storage tanks occupying a major
portion of the hull volume" of the vessel.
Whereas claim 1 contemplates livestock food being stored in below deck tanks and conveyed directly therefrom to each of the confinement pens and claim 2 contemplates food being conveyed via pipelines interconnecting the below deck storage tanks and the confinement pens, the specification describes a method of delivery whereby the food is conveyed from the storage tanks below deck to dispensing containers situated on each storey of the sheephouse structure. The specification provides no clue as to the method of supplying food from the dispensing containers to the confinement pens. According to the evidence, the only known method of supplying food to the confinement pens as at the claimed priority date was by means of wheelbarrows or hand held buckets. If it is assumed that the specification contemplates that food would be supplied from the dispensing containers to the confinement pens by the only then known means of conveyance, i.e. by wheelbarrow or hand held bucket, then the question arises as to whether the conveyance means so described is a means of conveying feed directly from the below deck storage containers to the confinement pens (claim 1) and whether such means involves the conveyance of food through pipelines interconnecting the below deck storage tank and the confinement pens (claim 2).
The meaning of the word "directly" in the context of this patent has generated considerable debate. There is a multitude of decided cases touching upon the rules of construction applicable to a claim defining an invention but it is not necessary to here embark upon an analysis of the learning to be distilled from those authorities. Ultimately it is for the Court to construe the claim according to the language used. It seems to me that for present purposes it is sufficient to refer to and follow the dictum of Gummow J in Sartas No 1 v Koukouran 30 IPR 479, in which his Honour said at 485-6:
It is for the court, not for any witness, however expert, to decide the question of construction in accordance with the meaning of the language used. Evidence can be given by experts to enlighten the judge on the meaning which those skilled in the art would give to technical or scientific terms and phrases and on unusual or special meanings given by such persons to words which might otherwise bear their ordinary meaning.
Despite the Court having had the benefit of expert witnesses called on either side of the debate, there is nothing in that evidence, nor is there anything of a contextual nature, to suggest that to those skilled in the art, the word "directly" is used as a technical or scientific term, or that it has been used in an unusual sense, so as to give it a meaning it would not otherwise bear. In these circumstances it is not profitable to canvass the various meanings suggested by the witnesses. The word must be construed according to its ordinary meaning in the context in which it is used.
The Shorter Oxford English Dictionary defines the "direct" when used as an adjective, and the adverb "directly", to include the following meanings:
Straight; undividing in course; not circuitous or crooked; uninterrupted; without intervening agency.
In the Macquarie Dictionary "directly" is defined as:
in a direct line, way or manner; straight; without delay; immediately.
It would be fanciful in the context of the patent in suit to suggest that the requirement that the sheep feed be conveyed from the below deck storage tanks directly to the confinement pens contemplates that feed would be conveyed in a straight line from the storage tanks to each individual confinement pen or that the course to be followed from the storage tank of each confinement pen would be undividing and not circuitous or crooked. The only sensible construction that can be applied having regard to the process being described and the ordinary meaning of the words used, is that the patent contemplates that the food would be conveyed from the storage tank to each confinement pen in an uninterrupted stream without the involvement of any intervening agency.
A system of food conveyance which involves the transfer of food from the storage tanks below deck to dispensing containers on each storey of the sheephouse and further contemplates the further distribution of food from the storage tanks to the confinement pens by some unspecified means but presumably by the drawing off of food from the dispensing containers into a wheelbarrow or bucket or some other conveyance for distribution to the confinement pens is not in my opinion a means of conveying the food from the below deck storage containers directly to the confinement pens. Nor is it a means whereby food is conveyed to the confinement pens through a pipeline interconnecting the storage tanks and the confinement pens.
Having regard to the foregoing, claims 1 and 2 of the patent in suit are not fairly based upon the specification nor is it the case that the specification describes the invention fully. In the circumstances I have reached the conclusion that the statutory requirements have not been met and that the patent is invalid and should be revoked.
I have some difficulty with the description in the specification of the means of conveying water to the confinement pens. Clearly it is contemplated that water will be initially stored in one or more of the below deck tanks but there is no reference in the specification to any equivalent to the dispensing containers in relation to the water distribution systems. The sentence -
Similarly, there may be water taps 21 communicating with water conduits within the hollow posts 11c for supplying drinking water from water tanks to the pens.
suggests that the water conveyor means will be similar to the food conveyor means. However the "water taps 21" are shown on Fig 3 as being located on the vertical columns adjacent to groups of confinement pens and as none of the 3 drawings forming part of the specification illustrates water tanks other than the below deck storage tanks it may be concluded that the drawings illustrate a water conveyance system which involves the conveyance of water from the below deck storage tanks to the pens without the intervention of any intermediate dispensing container. If this is so, which it appears to be, and notwithstanding the prefacing of the description with the word "similarly", the water conveyor means described in the specification is consistent with that part of claim 1 which refers to -
livestock water conveyor means extending for another or other of such storage tanks to said livestock confinement pens whereby water can be bulk stored in said another or others of said storage tanks and delivered directly therefrom to each of said confinement pens by said water conveyor means
and such a description is also consistent with the claim in claim 2 in relation to the water conveyor means comprised of separate pipelines interconnecting the storage tanks with the confinement pens with water conveyed through the pipelines to the pens. Such a water conveyor method would indeed provide for the delivery of water from the storage tanks directly to the confinement pens.
THE RESPONDENT'S OTHER GROUNDS OF DEFENCE
Although the conclusion I have reached in relation to the provisions of s 40 of the Patents Act is sufficient to dispose of the applicant's claim and the cross-claim in this proceeding I proposed in the following paragraphs to deal with a number of other issues raised in the respondent's grounds of defence in case, contrary to my conclusion, it later be found that the provisions of s 40 were in fact satisfied.
1) Does the claimed invention involve an inventive step?
The respondent says that the claimed invention does not involve a new manner of manufacturer; that it is obvious.
The parties are at one to the extent that they agree that claims 1, 2 and 3 are combination claims.
The test for obviousness in relation to a combination patent is whether it would have been obvious to a non-inventive skilled worker in the field to select from the range of publications the particular combination subsequently chosen by the opponent with the advantage of hindsight and whether it would have been obvious to that worker to select the particular combination of integers from those selected publications (Minnesota Mining and Manufacturing Company v Beiersdorf (Australia) Ltd 144 CLR 253). At p 266 of the report in 3M Aickin J said:
The patent thus claimed is a combination patent in the proper sense of that term, i.e. it combines a number of elements which interact with each other to produce a new result or product. Such a combination may be one constituted by integers each of which is old, or by integers some of which are new, the interaction being the essential requirement.
The idea conceived by Hansen which found expression in Claims 1, 2 and 3 of the patent involved a combination of
a) the conversion of an oil tanker with a large deck space and substantial below deck storage capacity;
b) the erection of an entirely above deck sheephouse;
c) the storage of livestock feed and water in the below deck tanks;
d) the supplying of livestock feed and water directly from the storage tanks to the confinement pens.
Oil tankers had previously been converted to other uses, but never as livestock carriers; above deck sheephouses had previously been used on livestock carriers but only on vessels which also had below deck livestock accommodation; livestock feed had previously been stored below deck but not in tanks; food conveyor systems of varying types were used on all livestock vessels but none had previously involved the supplying of feed directly from the bulk storage tank to the individual confinement pens. Each of these several developments taken in isolation could well be regarded as obvious steps in the evolution of those individual aspects of the art but the combination of the several integers interacted with each other to produce a new product namely an ocean going vessel capable of transporting very large numbers of sheep over long distances. In my opinion the claimed invention does involve an inventive step.
2. Are the claims fairly based on the basic Danish application?
The claimed priority date of 28 November 1975 applies only if the complete specification for the Australian patent is fairly based on Hansen's Danish application. If the claims are not fairly based on the basic Danish application the earliest priority date is 17 September 1976.
The test applied by the Full Court of the Federal Court in CCOMS Pty Ltd v Jiejing Pty Ltd 51 FCR 260 to determine whether a claim is fairly based on the matter described in the specification is to ask whether there has been "a real and reasonably clear disclosure". The same test applies in determining whether a claim is fairly based on a basic application. In F. Hoffman-La Roche & Co Aktiengesellschaft v Commissioner of Patents 123 CLR 529 at 538-9 Gibbs J adopted as a guide to the approach that should be made in deciding a question of this kind the following three questions:
(1) Is the alleged invention as claimed broadly (ie in a general sense) described in the basic application?
(2) Is there anything in the basic application which is inconsistent with the alleged invention as claimed?
(3) Does the claim include as a characteristic of the invention a feature as to which the basic application is wholly silent?
The test is not to merely compare the claims of the two specifications but to compare the claims of the latter with the disclosure made in the earlier application.
The respondent says that the integer of the claims made in the patent that there be a direct conveyance of feed and delivery of water from bulk storage to each pen is not included either in the claims of the basic application or expressly referred to in its body.
In the specification of the basic application the applicant says:
The feed may be blown upwards through pipelines into a silo for each of the tiers defined by the feed alleys, but there may also be automatic feeding systems which distribute the feed to each pen.
The question is whether what are referred to as the "direct" integers of the patent have a fair basis in this passage from the basic application.
On the basis of the meaning that has been attributed to the word "direct" earlier in these reasons I am of the opinion that the invention described in the patent satisfies each of the 3 tests referred to by Gibbs J in Hoffman-La Roche to which reference is made above. In each case the object is to describe a method for the conveyance of feed from the bulk storage to the confinement pens which does not involve the involvement of an intervening agency.
3) Was Hansen the inventor?
On the findings made earlier in these reasons this question must be answered in the affirmative. For the same reason I find there is no basis in the assertion that the patent was obtained by Hansen making a false declaration to the Patent Office.
4) Is the claimed invention useful?
The ground of inutility may be established either by showing that the invention does not produce any useful result at all or by showing that the advantages stated or promises made in the specification cannot be fulfilled by all or some of the products falling within the claims. The utility of an invention must be judged at the date of the invention.
Each of the claims in the patent include an ocean going vessel converted for the carriage of a main cargo of livestock. It is said by the respondent with compelling force that the object of transporting livestock is to have live stock (and not dead stock) at the point of destination and that an invention which does not provide sufficiently for the ventilation of the livestock pens to ensure the survival of the stock to the point of destination lacks utility.
At lines 18 - 20 the specification says -
The side walls of the pens 14 may be made of grids 23 as shown schematically in fig. 3 so as to provide adequate flow through ventilation.
In the basic Danish application it is stated at p. 3 -
The features defined in claim 4 obviate the need for artificial ventilation.
I interpret the words "adequate flow through ventilation" as meaning ventilation by the natural passage of air through the sheephouse without the assistance of any mechanical device. The evidence establishes that as at the priority date Hansen did not appreciate the need for any mechanical ventilation as he thought that natural ventilation for sheephouses above deck would be sufficient. Further, it is also established that as at 1975 there was no Australian regulation relating to ships used for the carriage of livestock which required mechanical ventilation of pens above the weather deck.
In the prior art vessels with above deck sheephouses were considerably smaller than those contemplated in the patent and because of their size they did not require mechanical ventilation to be provided above deck although it was always a necessity below deck. It is not surprising therefore that those who made the regulations had not responded to a need which had never arisen and was not in contemplation. It is clear that Hansen addressed the question of ventilation and concluded that his invention would "obviate the need for artificial ventilation" (basic application) or would "provide for adequate flow through ventilation" (patent in suit).
Claim 3 of the patent refers to a superstructure which -
defines access corridors extending between adjacent rows of pens, each of said corridors extending upwardly through two storeys of the superstructure so as to provide for accessibility to two rows of pens on each side of the corridor.
The drawings incorporated by claim 4 show a superstructure comprising 10 storeys of sheep pens in 5 blocks with 4 internal corridors which extend upwardly through two storeys of the superstructure.
The evidence establishes that such a superstructure if
used for the carriage of sheep over long distances particularly in the
contemplated trade between Australia and the Middle East would require
mechanical ventilation to be provided to the confinement pens if the object of
delivering a substantial part of the cargo alive is to be achieved. In the invention described such flow through
ventilation as may be available is not adequate to achieve the stated purpose
of the invention namely to facilitate the long distance transportation of large
numbers of livestock and for that reason I am of the opinion that it lacks
utility.
5) Were the claims of the patent when properly construed, infringed?
As this question is posed in a context which assumes the validity of the patent, for present purposes it may be assumed (contrary to my earlier findings) that the provisions of s 40 are satisfied and that the invention is useful.
In my opinion Mawashi at Gasseem, as described earlier in these reasons, infringes claim 1 of the patent.
The only question of any substance raised in relation to this aspect of the case is whether the feed conveyance method on Mawashi al Gasseem delivers the feed directly to the confinement pens. Having decided the construction of "directly" adversely to the submissions of the respondent, the remaining issue is whether a system which delivers feed to a pipe at each pen but which requires a tap to be manually operated in order to enable the feed troughs to be filled is a system which conveys the feed directly to the pen. To state the issue in this way is sufficient to provide the answer. The patent does not claim a system of automatic or direct feeding. It is directed to providing for the conveyance of feed from the bulk storage tank to each individual confinement pen without the involvement of any intervening agency. The system on Mawashi al Gasseem achieves exactly that end. How and what feed is to be made available to sheep in the confinement pens is a different issue and whilst it may well be a labour intensive task for some 2500 or more taps to be activated on each occasion that troughs are to be filled or topped up this is not a problem which the inventor claims to have addressed.
CONCLUSION
In my opinion the complete specification of the patent does not comply with the provisions of s 40 of the Patents Act and for that reason the patent is invalid.
Further, I am of the opinion that the invention claimed in the patent lacks utility and would be invalid for that reason.
The application will accordingly be dismissed. The respondent is entitled to an order that the patent be revoked.
I certify that this and the preceding 71 pages are a true copy of the Reasons for Judgment of the Honourable Justice Olney
Associate:
Dated:
Heard: 18-20 and 25-28 September 1995, 2, 3, 5, 6, 9-11 and 17 October 1995
Place: Melbourne
Judgment:21 February 1996.
Appearances:
Mr R. Macaw QC with Mr B.J. Hess (instructed by Corrs Chambers Westgarth) appeared for the applicant.
Mr D. Shavin QC with Mr A.J. Ryan (instructed by Finlaysons) appeared for the respondent.
