3WJ Pty Ltd v Kanj

3WJ Pty Ltd and others (the appellants) appealed to the Court of Appeal of New South Wales against a decision of Johnstone DCJ in the District Court. The dispute concerned allegations of fraud, and the central issue on appeal was the trial judge's refusal to permit the appellants to call witnesses to challenge the credibility of a key witness for the respondents.

The Court of Appeal was required to determine whether the trial judge erred in refusing to allow the appellants to adduce evidence impugning the credibility of the respondents' witness, particularly in circumstances where the accusation of fraud was pleaded. Further, the court considered whether the trial judge had regard to the relevant matters under section 192 of the *Evidence Act 1995* (NSW) when making decisions about the admissibility of evidence, including the cross-examination of a party's own witness.

The Court of Appeal found that the trial judge had misapplied the "surprise rule" and had not properly considered the principles governing the admission of evidence relevant to credibility, especially in the context of fraud allegations. The court held that the refusal to allow the appellants to call their witnesses to challenge the credibility of the respondents' witness constituted a material error. Consequently, the appeal was upheld, the judgment of the District Court was set aside, and the matter was remitted for a new trial. The appellants were awarded their costs of the appeal, with the costs of the new trial to be determined by the judge presiding over that trial.