Federal Court of Australia

EV20 Consulting Group Pty Ltd v Paperless Warehousing Pty Ltd (No 4) [2026] FCA 805

ORDERS

THE COURT ORDERS THAT:

1.    The interlocutory application filed by the sixth cross-respondent on 16 July 2025 be dismissed.

2.    The sixth cross-respondent pay the cross-claimant’s costs of the interlocutory application.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

BURLEY J:

1.    INTRODUCTION

1    Christopher Pearce is the sixth cross-respondent to a cross-claim brought by Paperless Warehousing Pty Ltd for infringement of copyright and various other causes of action. The substantive proceedings have been on foot since 2021 and have involved numerous interlocutory disputes. On 14 May 2025 orders were made giving default judgment against Mr Pearce and two other cross-respondents, following delivery of judgment on an application brought by Paperless: EV20 Consulting Group Pty Ltd v Paperless Warehousing Pty Ltd (No 2) [2025] FCA 476 (second default judgment). The default by Mr Pearce that prompted the entry of the second default judgment was his failure to file a Notice of address for service after his solicitors, Gillis Delaney, filed a Notice of ceasing to act on 9 October 2024.

2    Following the second default judgment, on 23 June 2025 Gillis Delaney filed a Notice of acting – appointment of lawyer, confirming that they had been reappointed to represent Mr Pearce in the proceedings.

3    By an interlocutory application dated 16 July 2025, Mr Pearce now seeks orders setting aside orders 4(c), 5, 8, 9, 10 and 11 made on 14 May 2025 in the default judgment pursuant to r 39.05 of the Federal Court Rules 2011 (Cth) (FCR). The application also seeks leave for Mr Pearce to file an amended defence to the cross-claim, should he be successful in his application to set aside the second default judgment. He relies on two affidavits dated 15 July 2025 and 9 February 2026 affirmed by himself and an affidavit given by his solicitor, Michael Gillis, of 6 February 2026. Paperless opposes the application and relies on an affidavit affirmed by its solicitor, Katrina Crooks of 26 February 2026 and an affidavit of Hannah Lowe, a paralegal, of 16 December 2024.

4    The proceedings were commenced with a claim brought by EV20 Consulting Group Pty Ltd alleging misrepresentation and wrongful threats of copyright infringement made against it and a number of its clients by Paperless, in respect of the use of some computer programs or compilations of computer programs. The cross-claim brought by Paperless alleged, amongst other things, that EV20 had been established by a number of its former employees, who proceeded to provide software maintenance services in respect of software developed and authored by Paperless as a warehouse management software system and provided by Paperless to its customers. It alleged infringement of copyright in the software owned by Paperless, breach of confidentiality, breach of employment contracts, and breach of licences by former customers of Paperless who had subsequently engaged EV20 to perform services in respect of its software: EV20 Consulting Group Pty Ltd v Paperless Warehousing Pty Ltd [2025] FCA 328 (first default judgment) at [5].

5    Mr Pearce was from 27 May 2020 the Executive Chairman of EV20. The cross-claim broadly alleged that since at least about 2020, EV20 had without authorisation reproduced computer programs the copyright in which is owned by Paperless and that Mr Pearce, by virtue of his senior role in EV20, had authorised the alleged infringement or made himself a joint tortfeasor to the infringement. Mr Pearce denies that he authorised or was a joint tortfeasor to that infringement.

6    At the hearing of the interlocutory application, Paperless was represented by Mr Wen Wu of counsel and Mr Pearce was represented by Mr Cheyne Clarke of counsel. Both filed helpful written submissions in advance of the hearing.

7    For the reasons set out below, the interlocutory application is dismissed with costs.

2.    LEGAL PRINCIPLES

8    Mr Pearce relies on FCR r 39.05(a) as the basis for setting aside the default judgment, which provides that:

The Court may vary or set aside a judgment or order after it has been entered if:

(a) it was made in the absence of a party; …

9    Quite apart from this rule, the Court has an inherent power to set aside an order made against a party in their absence: see Taylor v Taylor [1979] HCA 38; 143 CLR 1 at 8.

10    In Amirbeaggi as trustee of the bankrupt estate of John Mamdouh Hanna v Kamel (No 3) [2020] FCA 1202, Yates J said:

10    Whether the power to set aside an order given in the absence of a party should be exercised in a given case is a matter of judicial discretion. In the context of an application to set aside a default judgment, the exercise of that discretion normally involves consideration of two questions. The first question is whether the party seeking to set aside the default judgment has provided a satisfactory explanation for that party’s absence given that, if a party has notice of proceedings and an opportunity to appear, but has not done so, that party should be bound by the decision that is given: Deputy Commissioner of Taxation v Hua Wang Bank Berhad (No 2) [2010] FCA 1296; 81 ATR 40 at [10].

…

12    The second question is whether the party seeking to set aside the default judgment has demonstrated an arguable defence to the claim in respect of which the judgment has been given. In this context, “arguable” means a defence of such merit that, in the interests of justice, the default judgment should not be allowed to stand: Dunwoodie v Teachers Mutual Bank Ltd [2014] NSWCA 24 at [43]. The obvious rationale for this inquiry is to ascertain whether any useful purpose would be served by setting aside the judgment that has been given: Vacuum Oil Pty Co. Ltd v Stockdale (1942) 42 SR (NSW) 239 at 243. This inquiry does not involve the Court embarking on a hearing of the full merits of the defence that is raised. However, the defence, as then advanced, must be supported by evidence that is appropriate to persuade the Court that it is sufficiently meritorious and is raised bona fide.

13    In exercising the discretion, the Court must be mindful of the requirements of s 37M(3) of the Federal Court of Australia Act 1976 (Cth), which provides that the civil practice and procedure provisions (which include the FCR) must be applied, and any power conferred by those provisions must be exercised, in a way that promotes the overarching purpose of facilitating the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible. Provisions such as s 37M(3) have brought about “a new statutory balance among the various factors in litigation including court and party efficiency and the delivery of individual justice”: Hans Pet Constructions Pty Limited v Cassar [2009] NSWCA 230 at [36].

11    In Sovereign Point Pty Ltd v Gu (No 2) [2020] FCA 1377, Davies J said:

7    The power of the Court to set aside a judgment under r 39.05 is discretionary but, generally, matters which will bear on the exercise of discretion to set a judgment aside are:

(a)    whether the evidence discloses a defence of sufficient merit to warrant setting aside the default judgment;

(b)    the explanation, if any, given by the party for their default;

(c)    whether the application to set aside the judgment was made promptly after the judgment came to the knowledge of the defendant; and

(d)    whether if the judgment was set aside the plaintiff would be prejudiced in any respect which could not be adequately compensated for by a suitable award of costs and the giving of security –

Evans v Bartlam [1937] AC 473; Violi v Commonwealth Bank of Australia [2015] NSWCA 152; Delta Metallics Pty Ltd v King [2012] FCA 1119 (Delta Metallics); 3D Funtimes Ltd v Intellec Development Group Pty Ltd (No 2) [2011] FCA 407 at [6].

8    In the present case, as judgment was entered in default 10 months prior to the application to set aside the judgement being made, a further consideration bearing on whether to exercise the discretion in Mr Gu’s favour is whether he has provided an acceptable explanation for the delay in applying for the default judgment to be set aside.

12    The Court’s jurisdiction to set aside orders should be exercised with caution, and is ordinarily only exercised in exceptional circumstances. Generally, the jurisdiction is not to be exercised unless it can be shown that, without fault on the applicant’s part, he or she has not been heard on a relevant question: CCGF Holdings Pty Ltd v Coegi Group Pty Ltd [2020] FCA 1402 (Rangiah J) at [61], [84]; Deputy Commissioner of Taxation v Berhad (No 2) [2010] FCA 1296 (Kenny J) at [10]; Sampson (Trustee) v Taboada [2017] FCA 79 (Burley J) at [11], [12].

3.    THE SUBMISSIONS

13    Mr Pearce accepts that default judgment was entered against him because of his failure to file a Notice of address for service following the filing by Gillis Delaney of a Notice of ceasing to act for him. He also acknowledges that there has been a lapse of some time between entry of the default judgment and the filing of the present application. He relies on the affidavit evidence to provide an explanation for both. Mr Pearce submits that the defence filed in the proceedings on behalf of him and a number of the other cross-respondents demonstrates that he has an arguable defence on the merits of the case brought against him. I note that counsel for Mr Pearce addressed the issue of whether there was a meritorious defence by reference to the filed defence, rather than the proposed amended defence, with the consequence that the issue of leave to amend falls away if Mr Pearce is not successful in setting aside default judgment. Ultimately, Mr Pearce submits that it is in the interests of justice to set aside the orders made and permit the matter to go to trial.

14    Paperless accepts that the defence filed for Mr Pearce demonstrates that he has an arguable defence but submits that he has provided no adequate explanation either for his defaulting conduct or for the time that it has taken for him to prosecute the present application and that it should be dismissed. Paperless also submits that reinstating Mr Pearce’s defence would be prejudicial to Paperless, on the basis that the passage of time that has occurred increases the difficulty of proving Mr Pearce’s state of mind as an element of the authorisation claims made against him (which was accepted by Mr Pearce’s counsel).

4.    BACKGROUND CHRONOLOGY

15    On 20 July 2021, Paperless filed its Notice of cross-claim against EV20 and a number of other cross-respondents, including Mr Pearce. Details of the cross claim are summarised in section 6 of the first default judgment at [57]–[90].

16    On 26 July 2021, Gillis Delaney filed a Notice of acting for Mr Pearce. At the time his role with EV20 was as its Executive Chairman. I infer that he was active in his involvement in the company at this time.

17    From about December 2021 Mr Pearce became “increasingly less involved” in EV20. He moved with his family from Sydney to Queensland but until August 2022 continued to discuss the affairs of EV20, including the litigation, with Rod Peters and Len Anderson, whom he understood to be the ultimate owners of EV20. He used an EV20 email address for his communications (EV20 email address).

18    Mr Pearce gives evidence that from late 2022, because his involvement in EV20 was “becoming increasingly marginal”, he “ceased to use” his EV20 email address. He does not say that he was disconnected from it, or that it ceased to be available to him at that time. Nor does he give evidence that he took the effort to tell anyone, including his lawyers, that he had ceased to use that address.

19    Mr Pearce also gives evidence that from late 2022 he conducted most of his email correspondence through a personal Gmail address.

20    Mr Pearce gives evidence that in early 2023 he was diagnosed with prostate cancer and had major surgery, taking many months to recover. During 2023 he continued to read email correspondence concerning EV20 and to speak to Mr Peters, Mr Anderson and solicitors at Gillis Delaney regarding the proceedings, as he hoped he might be able to assist with their resolution.

21    In his affidavit, Mr Pearce gives evidence that he “commenced employment in a role with a shipping enterprise in Queensland in October 2023”, being a group of companies called Sea Swift. He gives evidence that as part of that employment, he has an email address connected to the company, and since then has conducted almost all email correspondence through that address. The affidavit of Ms Crooks annexes significant details available from public searches that indicate that Mr Pearce took up multiple directorships within this group of companies from October 2022. The evidence discloses (and Mr Pearce does not dispute) that Sea Swift is a significant commercial organisation which employs over 520 staff and operates to deliver goods to remote communities in Northern Australia.

22    On 11 October 2023, EV20, Mr Pearce and other cross-respondents filed a joint defence to the then current cross-claim advanced by Paperless. Subsequent amended defences were filed on 7 February 2024, 7 March 2024 and 3 June 2024.

23    In October 2023, Mr Pearce was appointed acting Chief Executive Officer of Sea Swift.

24    The news articles and media releases annexed to Ms Crooks’ affidavit indicate that by late 2023, Mr Pearce was referred to as the “managing director” of Sea Swift. These materials demonstrate that he represented Sea Swift at public events, including meeting with Members of Parliament, gave evidence on behalf of Sea Swift at a Queensland Parliamentary Inquiry and represented Sea Swift publicly in the media.

25    Mr Pearce does not refer to or explain what communications, if any, he had with EV20 or Gillis Delaney in the period from November 2023 until September 2024.

26    On 24 September 2024 Gillis Delaney served a Notice of intention to cease to act on Mr Pearce at his Gmail address which notified him that after 7 days Gillis Delaney would file a notice that Gillis Delaney has ceased to act as his lawyers, and informing him of his obligation to file in the Federal Court Registry a notice of his address for service within 5 days of receiving that notice of ceasing to act.

27    On 15 October 2024 Gillis Delaney filed a Notice of ceasing to act and sent it to Mr Pearce’s EV20 email address, based on the contact details that Gillis Delaney held on file from 2021 for Mr Pearce. Gillis Delaney received notification that the email delivery had been completed.

28    Mr Pearce gives evidence that he “has no record of receiving” from Gillis Delaney email correspondence sent either to his Gmail address or his EV20 email address enclosing the Notice of intention to cease to act or Notice of ceasing to act. He confirms that as at October 2024, he had not advised Gillis Delaney that he had stopped using those email addresses. In a clarifying affidavit he says that although he does not recall receiving the emails, he does not suggest that they were not sent to him.

29    He also gives evidence that he does not any more have access to emails from 2024 at either of these email addresses. I understand this to mean that as at the date of that affidavit, being July 2025, Mr Pearce did not have such access. He does not disclose when he ceased to have access to those emails, why, or whether all past email correspondence from both addresses has been lost.

30    On 7 November 2024 the solicitors acting for Paperless served its application for default judgment on Mr Pearce by email and registered post at his last known address advised in the Notice of ceasing to act. This was a physical address in Norwest, NSW and Mr Pearce’s EV20 email address. On 6 December 2024, a copy of Paperless’ submissions and affidavit evidence in support of the application was also sent to the Norwest address and Mr Pearce’s EV20 email address.

31    Mr Pearce gives evidence that he did not receive any of these emails or parcels. He points out in his submissions that, in an earlier affidavit of service sworn by Ms Lowe on 30 October 2024, evidence is given that a different parcel sent to Mr Pearce at the Norwest address in October 2024 was returned to Spruson & Ferguson’s offices by way of the return to sender service.

32    On or around 5 June 2025, Mr Pearce was served with the final orders made consequent upon the default judgment being entered. This service was effected by Spruson & Ferguson mailing the documents to a Queensland address where Mr Pearce resides. Mr Pearce gives evidence that this was the first notification he received of the default judgment application and outcome. He spoke with Mr Gillis on the same day and emailed documents to Gillis Delaney from his Gmail address.

33    On 23 June 2025, Gillis Delaney filed a Notice of acting for Mr Pearce.

5.    CONSIDERATION

34    Mr Pearce submits that the discretion to set aside the default judgment should be exercised in his favour for substantively three reasons. First, he did not receive the application for default judgment. Secondly, there was no material delay between learning of the default judgment and the present interlocutory application. Thirdly, he has a substantive defence to the proceedings.

35    The chronology of events to which I have referred above is material to the first submission. The fault for lack of service of the default judgment application does not lie with Paperless. Rather, it lies with the fact that Mr Pearce did not notify his solicitors of his change of addresses, both email and physical. Beneath that explanation are a number of salient points.

36    First, Mr Pearce occupied a senior position within EV20 and was actively involved in the litigation between EV20 and Paperless following its commencement in 2021. In the period leading up to and during the course of 2023 he was in contact with both his solicitors and also Mr Anderson and Mr Peters about that litigation. I infer that he well understood that he was potentially personally liable for the actions of EV20.

37    Secondly, neither Mr Gillis nor Mr Pearce give evidence of their communications from the end of 2023 until September 2024, when the Notice of intention to cease to act was sent. It behoved Mr Pearce to provide an explanation for that period. Although he gives evidence that he was disgruntled with EV20 because he had not been paid for the effort that he put into it, he does not explain what happened in that period, beyond giving evidence that he had commenced employment with Sea Swift by this time and was working there. I infer that he did not give evidence about this period because it would not assist his case. I further infer that during that period Mr Pearce continued to be in communication with Gillis Delaney and with officers of EV20 in the manner that he had communicated with them in 2023. That inference is supported by the fact that on 3 June 2024 Gillis Delaney filed a Defence to the Third Further Amended Statement of Cross Claim on behalf of Mr Pearce and a number of the other cross-respondents.

38    Further, neither Mr Pearce nor Mr Gillis give any evidence about the circumstances of Gillis Delaney ceasing to act or whether Mr Pearce was informed that Gillis Delaney would do so, beyond the formal requirements of emailing and filing the Notice of intention to cease to act. Notably, whilst Mr Pearce says in his affidavit that he does not recall receiving the emails attaching the Notices, he does not give evidence that he had no notice that Gillis Delaney would come off the record. I infer that he does not give such evidence because he cannot, and that Mr Pearce was aware that Gillis Delaney would do so.

39    Thirdly, the evidence concerning email communications is unsatisfactory. Mr Pearce has not given any evidence that his Gmail address and his EV20 email address were not operational at the relevant times, though he does state in his 2025 affidavit that he no longer has access to any emails to or from his EV20 email address. He gives evidence that he is “unable to say one way or the other” whether he received both the Notice of ceasing to act and the Notice of intention to cease to act by email in 2024, although he does not recall doing so. He has not retained 2024 email records.

40    I find it difficult to accept that a person in the position of Mr Pearce would retain an active Gmail account and yet not open and read emails sent to it in 2024, when he gives evidence that he was reading emails sent to it in 2023 and engaging in discussions using it both with his lawyers and Mr Anderson and Mr Peters.

41    Fourthly, Mr Pearce apparently did not notify his solicitors of three important matters. First, that in December 2021 he had moved home address. Secondly, that from around the end of 2022 he ceased to use his EV20 email address; and thirdly, that from October 2023 he “very rarely” used his Gmail address. No explanation is offered about why his solicitors were not informed of any of these things. I infer that it is because there is no satisfactory explanation.

42    Fifthly, Mr Pearce is, I find, a sophisticated businessman. He has been involved in the EV20 litigation over a period of years. He is now the Managing Director of a significant corporate group. I find that Mr Pearce is not a naïve litigant who does not know the consequences of taking steps in litigation, or failing to do so.

43    Taken together, these matters paint a picture of Mr Pearce as a person who has chosen to ignore communications concerning the litigation against him because it did not suit him to attend to them. It may be that Mr Pearce did not open the emails concerning, or read the Notice of intention to cease acting and Notice of ceasing to act, but if that was so, then it was a deliberate decision of Mr Pearce to ignore the litigation. As explained above, I also infer that Mr Pearce had some knowledge that Gillis Delaney intended to come off the record.

44    I regard Mr Pearce’s explanation of why he did not take steps to defend the application for default judgment as wholly unsatisfactory and indicative of fault on his part.

45    The next point of relevance is the period of time between Mr Pearce learning of the default judgment and bringing the interlocutory application to hearing. The evidence in relation to this may be briefly summarised.

46    Mr Pearce was served with the final orders on or around 5 June 2025 and on the same day spoke to Mr Gillis. On 23 June 2025 Gillis Delaney filed a Notice of acting for Mr Pearce. On 16 July 2025 the present interlocutory application for reinstatement of the proceedings was filed. On 1 August 2025, Paperless filed and served a third-party costs application against Gillis Delaney. That resulted in a decision on 3 November 2025, dismissing the application: EV20 Consulting Group Pty Ltd v Paperless Warehousing Pty Ltd (No 3) [2025] FCA 1348.

47    Gillis Delaney considered that the third-party costs application gave rise to a conflict of interest between it and Mr Pearce and so ceased acting for Mr Pearce whilst it was on foot (albeit that it had not filed any formal notices to this effect despite the Court making multiple enquiries in this regard).

48    Thereafter, between 3 November 2025 and 14 January 2026, Gillis Delaney recommenced acting for Mr Pearce but did not move to have the present interlocutory application relisted. On 14 January 2026 Gillis Delaney emailed my chambers seeking to have the application listed for case management.

49    Paperless submits that Mr Pearce has not prosecuted his application in a timely manner and has failed to explain why he did not do so. It submits that the delay between the service of final orders on him and the filing of the application was a delay of 40 days and that the delay between 3 November 2025 (when the third-party costs application was resolved) and 14 January 2026 was a further delay of 72 days.

50    Mr Gillis gives evidence that by oversight he did not take steps to appropriately inform the Court that he had recommenced acting for Mr Pearce, and to seek to relist the matter to secure a hearing date for the interlocutory application. Whilst I accept that Mr Pearce could himself have agitated to have the matter listed, I do not consider that the oversight of Mr Gillis or Mr Pearce’s inaction weighs heavily against the exercise of discretion.

51    Counsel took me to the Defence to the Third Further Amended Statement of Cross-Claim relied upon by Mr Pearce in support of the submission advanced that he has an arguable defence to the proceedings. Counsel for Paperless accepted in the hearing that this is so. I take that into consideration in exercising the discretion.

52    Finally, Paperless submits that in the exercise of the discretion under FCR r 39.05(a) the Court should take into account prejudice to Paperless should the default judgment be set aside.

53    Paperless contends that if Mr Pearce’s defence were reinstated, Paperless bears the onus of establishing the liability of Mr Pearce for authorising the acts of copyright infringement and for joint tortfeasance alleged in the cross claim.

54    It submits, and Mr Pearce accepts, that the following circumstances which have arisen due to the passage of time mean that evidence relevant to establishing those elements has been lost:

(a)    Mr Pearce no longer has access to his EV20 email address;

(b)    Mr Pearce no longer has access to emails in his EV20 email address or his Gmail address from 2024;

(c)    it can be inferred that Mr Pearce no longer has access to emails sent to him earlier than 2024, including emails sent during the time whilst he was active in the conduct of EV20; and

(d)    EV20 is said to have ceased operating in or around June 2023.

55    In connection with the last point, Paperless further notes that the default judgment records that WMS Pty Ltd or Mr Peters appeared to have taken over EV20’s operations and its computers and information therein have been assigned to Mr Peters: first default judgment at [27], [45], [47]. It submits that those parties may not have retained documents concerning Mr Pearce’s role and conduct at EV20 with the consequence that evidence relevant to the litigation has been lost.

56    Mr Pearce submits that this last point is a matter for speculation. I agree that there is no evidence one way or the other about that. However, I accept as a general proposition that in the almost two years between when Gillis Delaney filed its Notice of intention to cease to act in September 2024 and now it is likely that evidence that would have been available to assist Paperless in the conduct of the case is likely no longer to be available. To that should be added that the litigation has been needlessly protracted through no fault of Paperless, with all of the attendant personal and legal burdens that accompany that protraction: Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175 at [100]–[101] (Gummow, Hayne, Crennan, Kiefel and Bell JJ).

57    Taking all of these matters into consideration, I am not satisfied that I should exercise the discretion under FCR r 39.05(a) in favour of Mr Pearce.

6.    DISPOSITION

58    The interlocutory application must be dismissed. Mr Pearce must pay Paperless’ costs of the application.

Associate:

Dated:    25 June 2026

SCHEDULE OF PARTIES