Paymaster (Jamaica) Ltd v Paul Lowe

• Jurisdiction: Jamaica
• Court: Court of Appeal (Jamaica)
• Judge: Brooks P,D Fraser JA,Laing JA (AG)
• Judgment Date: 15 July 2024
• Neutral Citation: JM 2024 CA 090
• Docket Number: SUPREME COURT CIVIL APPEAL NO COA2020CV00048

Between

Paymaster (Jamaica) Limited

Appellant

and

Paul Lowe

Respondent

[2024] JMCA Civ 32

Before:

THE HON Mr Justice Brooks P

THE HON Mr Justice D Fraser JA

THE HON Mr Justice Laing JA (AG)

SUPREME COURT CIVIL APPEAL NO COA2020CV00048

IN THE COURT OF APPEAL

Civil procedure — Injunction — Interlocutory — Undertaking as to damages — Cross-undertaking as to damages — Enforcement of undertaking — Quantification of damages — Loss of a chance — Claimant obtaining interim injunction in copyright infringement proceedings — Court subsequently finding copyright claim invalid — Quantification of damage occasioned to defendant for purpose of enforcing cross-undertaking given by claimant — Obligations on the defendant to prove loss under the counter-factual scenario — Whether compensation can be granted for loss of reputation

Aspects of a computer program not subject to copyright protection

Copyright Act, 1993 – ss 2, 5 and 6

Maurice Manning KC, Mark-Paul Cowan and Ms Allyandra Thompson instructed by Nunes, Scholefield, Deleon & Co for the appellant

Vincent Chen and Mrs Vanessa Reid Pringle instructed by Chen, Green & Co for the respondent

Brooks P

1 I have read in draft the judgment of my brother D Fraser JA. I agree with his reasoning and conclusion and have nothing to add.

D Fraser JA

Introduction

2 This is an appeal from an assessment of damages regarding loss flowing from an interlocutory injunction granted on 25 August 2000, restraining the conduct of the respondent Paul Lowe (‘the respondent’ or ‘Mr Lowe’) in relation to a software program referred to as “The Paymaster Multiple Collection Program”. The assessment was conducted by Palmer Hamilton J whose judgment with neutral citation Paymaster (Jamaica) Limited v Grace Kennedy Remittance Services Limited and Paul Lowe [2020] JMCC COMM 11 delivered on 11 June 2020, culminated in the following order:

“1. The Applicant is awarded damages of J$282,259,386.80 plus interest thereon calculated at the rate of 6% per annum from the 25th day of August, 2000 to the 11th day of June, 2020.

2. Costs to the Applicant to be taxed if not agreed.”

3 The interlocutory injunction granted in 2000 regarding the software stated:

“(1) The Defendants be restrained whether by themselves, their officers, servants or agents or any of them otherwise howsoever from doing any of the following acts.

a. Reproducing or authorising the reproduction without the Plaintiff's consent of the Paymaster multi-payment collection software system of its computer software programme.

b. Possessing in the course of business or selling or offering for sale or using without the Plaintiff's licence any copies or materials of the said programme.

c. Converting for their own use infringing copies of the Plaintiff's said computer software.

(2) The Plaintiff gives the usual undertaking in damages…”

4 The detailed history of this matter was traversed by Lord Hodge in the judgment of the Judicial Committee of the Privy Council (‘JCPC’) intituled Paymaster (Jamaica) Limited and another (Respondents) v Grace Kennedy Remittance Services Limited (Appellant) (Jamaica) Paymaster (Jamaica) Limited (Appellant) v Grace Kennedy Remittance Services Limited and another (Respondents) (Jamaica) [2017] UKPC 40 (‘the JCPC judgment’). In setting out the necessary background, I will, in parts, quote significant portions of that history.

5 The appellant, Paymaster (Jamaica) Limited (‘Paymaster’), is a company that was incorporated by Ms Audrey Marks to develop in Jamaica a multi-payment agency system, whereby it would facilitate payments to its many client companies by collecting such payments on their behalves. These clients would pay it a fee for that service. The way development of that business idea proceeded was outlined at paras. 3 and 4 of the JCPC judgment as follows:

“3. In 1994 Paymaster employed a consultant, Dr Maurice McNaughton of Jamaica Online Information Services Ltd (‘JOL’), to assist it in developing its multi-payment agency concept by identifying the tasks for which software would be designed. This involved (a) a network linking all of the collection outlets to a head office, (b) multi-client cashiering software at the collection outlets and (c) head office software to collect and consolidate payment information from the outlets at the end of each operating shift. In about April 1995 JOL commissioned Mr Paul Lowe (‘Mr Lowe’), a computer programmer, to prepare a suitable program. Mr Lowe's business was the development of software for monetary transfers. He had developed a cashiering program which collected payments for a single company directly, called CSSREMIT, which he marketed to companies in Jamaica, the Cayman Islands and Tortola BVI and to agencies of the Government of Jamaica. Mr Lowe's business practice was to modify his basic CSSREMIT program to meet the specific needs of each client and, retaining his copyright, to grant the client a non-exclusive licence to use the program as so modified. Mr Lowe granted Paymaster a non-exclusive licence to use CSSREMIT for the multi-payment program which he developed at Paymaster's request and expense. Paymaster used the modified program to operate its business.

4. The software for the multi-payment agency concept involved (a) a branch function which enabled a customer to settle bills from different companies from one location or branch and (b) a head office function by which data from that branch were transmitted to an intermediary which collated the data and transmitted the correct data and payments to each of the client payee companies.”

6 At para. 5 it was noted that:

“Paymaster set up various outlets and incurred expense to Mr Lowe for improving and rectifying the software. Over time Paymaster won contracts with several utility companies and sought to increase the number of its branches in order to expand the availability of its services to the public and win new client companies.”

7 During the development process, discussions were held between Ms Marks and Mr Brian Goldson, the managing director of Grace Kennedy Remittance Services Ltd (‘GKRS’), concerning the possibility of GKRS investing in Paymaster. GKRS was a Jamaica-based agent of a Jamaican subsidiary of Western Union Corporation, a United States corporation which provided electronic bill-payment and money transfer services in the United States and several other countries. Two versions of Paymaster's business plan were shared confidentially with GKRS, but ultimately the investment was not pursued.

8 The genesis of the long-running dispute between the parties was summarised at paras. 6 and 7 of the JCPC judgment as follows:

“6. In 1999 Mr Lowe approached GKRS with a proposal to grant a non-exclusive licence of the CSSREMIT software which he had developed for Paymaster and to customise it to meet GKRS's needs. After negotiations, Mr Lowe gave GKRS a non-exclusive licence to use the program. Using this software GKRS entered the market for the provision of a multi-payment agency system in Jamaica in competition with Paymaster in about April 2000.

7. Paymaster contended that both GKRS and Mr Lowe had infringed its copyright in the software which [the respondent] had prepared for it. In August 2000 Paymaster obtained an interlocutory injunction restraining GKRS and Mr Lowe from using the software. GKRS has not used that software since being enjoined against so doing. The software, which was a DOS-based program, has long since become obsolete and both Paymaster and GKRS have operated their businesses using different software…”

9 In the substantive claim, Paymaster alleged breach of copyright and breach of confidence against both Mr Lowe and GKRS. On judgment being entered in favour of Mr Lowe and GKRS on 30 April 2010, the interim injunction was discharged. An enquiry into damages consequent on the undertaking given by Paymaster on the granting of the interim injunction was ordered.

10 On 27 March 2015 this court dismissed Paymaster's appeal on breach of copyright and its claim for breach of confidence against Mr Lowe. It allowed the appeal against GKRS in respect of the claim for breach confidence, while also allowing Mr Lowe's cross appeal. The court agreed that Mr Lowe had suffered loss by Paymaster having obtained the interim injunction which compelled him to terminate his contract with GKRS and forfeit the benefit of a service contract with it. An order for the enquiry into damages pursuant to the undertaking was again made.

11 When the matter was further appealed to the JCPC, it was settled that: a) Mr Lowe retained the copyright to his software and had granted Paymaster a non-exclusive licence to use the program as modified to its specific needs; b) GKRS had not breached the confidence of Paymaster when setting up its business in competition to the appellant; and c) Mr Lowe had not breached the confidence of Paymaster by providing to GKRS limited information concerning Paymaster along with the software he delivered to them.

12 Those matters of liability having been settled, the enquiry into damages which had been ordered by the Supreme Court and this court proceeded. It resulted in the order for damages to be paid to Mr Lowe, which is the subject of this appeal.

The evidence at the assessment

13 The evidence before the assessment judge consisted of: i) the affidavits and witness statements of Mr Lowe, Mr (now Dr) Maurice McNaughten (initially as an Information Technology Executive and then as Assistant Vice-President of Product Development of GKRS), Mr Jason Cooke (as Information Technology Manager at GKRS and then as Information Technology Specialist); ii) the affidavit of Ms Audrey Marks, Managing Director and principal shareholder of Paymaster, and iii) the witness statements of Ms Joan-Marie Powell, Managing Director of GKRS and Mr Patrick Dallas, ICT Consultant. The court also received the oral evidence of Mr Lowe on his case and Mr...