The siblings are suing Tim Manton, his company Manton Music, and UK-based management firm HNOE, which operates as TaP.
The Stones appeared on Wednesday in a Sydney Supreme Court hearing, where their lawyer Simon Philips argued HNOE had demanded commissions above what is legally allowed under the NSW Entertainment Industry Act.
"The intention of the act is to provide protection for performers," Mr Philips told the court.
The duo have three dates listed to play Sydney's State Theatre in August, two of which are sold out. (EPA PHOTO)
Lawyer for Mr Manton and the companies, Patrick Flynn SC, argued the claim should be dismissed on grounds including that NSW laws may not apply, as the case played out across a range of jurisdictions.
Mr Flynn argued HNOE invoiced the Stones for its share of the commission from London and the contract between the parties had been signed in Los Angeles.
"The agreement was made outside NSW. The amounts were received in the UK. The demands were made outside NSW," he said.
"If all the physical elements have to be in NSW then we say they're not."
Mr Philips said while the contract had been signed in Los Angeles, "that doesn't necessarily mean it was made in Los Angeles".
He explained the duo were only in the Californian city for a few days for a recording session when they signed the agreement, as well as noting HNOE's invoice to them had been in Australian dollars.
Mr Philips told the court the Stones have an "overwhelming" connection to NSW, having primarily resided and recorded most of their music in the state.
Mr Manton helped establish the HNOE office in Los Angeles, where he was based between 2013 and 2016, before most likely moving back to NSW, the court heard.
Angus and Julia Stone formed in 2006 and shot to fame on the back of their single, Big Jet Plane.
Mr Manton acted as their manager since at least 2012, the court heard.
The duo have three dates listed on their website to play Sydney's State Theatre in August, two of which are sold out.
The hearing continues.
