Bailey Aluminium Products Pty Ltd v Rees & Anor

[2009] HCATrans 121

[2009] HCATrans 121

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M1 of 2009

B e t w e e n -

BAILEY ALUMINIUM PRODUCTS PTY LTD

Applicant

and

GARY REES

First Respondent

BARRY PHILLIPS

Second Respondent

Application for special leave to appeal

HAYNE J
BELL J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 29 MAY 2009, AT 2.43 PM

Copyright in the High Court of Australia

MR R.J. STANLEY, QC:   If your Honour pleases, I appear with my learned friend, MR S.A. O’MEARA, on behalf of the applicant.  (instructed by Hall & Wilcox)

MR J.H. KENNAN, QC:   If your Honour pleases, I appear with my learned friend, MR P.T. VOUT, for the first respondent.  (instructed by Clark Toop & Taylor)

HAYNE J:   There is a submitting appearance for the second respondent, is that right?

MR STANLEY:   Yes, I understand that is so.

HAYNE J:   Yes, Mr Stanley.

MR STANLEY:   Your Honour, this application is about a civil jury case in which the most potent misconduct by counsel for the defendant consisted of cross‑examination of the third party as to an alleged fraudulent conspiracy he had been involved in with the plaintiff.  The allegation had not been put to the plaintiff when he had been cross‑examined and it was in fact denied by the third party.  Counsel for the defendant did not cross‑examine further on the issue and he did not touch on it at all in his closing address to the jury.  However, it did feature very prominently in the address of counsel for the plaintiff. 

It was a forensic choice by him to exploit the improper cross‑examination with the aim of advancing the plaintiff’s case.  The plaintiff’s case failed.  However, the Court of Appeal found and the fact is that the verdict of the jury was a regular one in the sense that it was not surprising and it was open on the evidence.  We say that, understood in that light, the decision of the Court of Appeal to set aside the jury verdict is of real significance and interest in the administration of justice.

HAYNE J:   Where do we find the first of those two steps that you say the Court of Appeal took?  Where do we most conveniently find their characterisation of the jury verdict as being open – and you used another epithet?

MR STANLEY:   At paragraph 137 which is at page 81.

HAYNE J:   Yes, thank you.  I am sorry I interrupted you.  Go on.

MR STANLEY:   What we say is, the question that is raised before this Court is this.  By reference to what standard and level of satisfaction an intermediate court should intervene in such circumstance as to grant a new trial?  The ultimate issue here is, was the trial unfair?  This, of course, is a question of degree and involves a value judgment.  Was this trial unfair to such an extent that it can be said with a reasonable degree of satisfaction that there was in fact a miscarriage of justice so that a new trial should be ordered?  We say it is not a question of whether there could have been but whether there was a miscarriage.  It is not a question of could, but a question of would.  In that regard we note the judgment of this Court just last week in the case of Edwards where the difference between the issue of “could” and “would” in terms of potential unfairness was discussed.

The question we say must be answered in the light of all of the circumstances of the trial, that includes particularly these five matters.  First, there is the nature and the extent of the misconduct.  Secondly, there is the reaction and the steps taken by opposing counsel, in this case counsel for the plaintiff.  Thirdly, it is relevant we say that all of the misconduct could have been cured by objection and appropriate directions being given by the trial judge.  The Court of Appeal found that, and it is referred to at paragraph 120 of the judgment in 137 also.

Then there is the fact that the jury’s version was, as I have said, unsurprising.  It was a regular verdict.  There was nothing inherently improbable or unreasonable about it and it was clearly open on the evidence.  Finally, there is the fact that the trial judge refused an application for a discharge that was made by counsel for the plaintiff after the plaintiff had lost, so far as the verdict was concerned, and the trial judge refused the application because she was not satisfied that counsel’s conduct did warrant such a step being taken.

BELL J:   The Court of Appeal in a very careful analysis, if I may say so respectfully, came to a different view.

MR STANLEY:   It did.

BELL J:   In those circumstances, if I can take up the third point you raise, which is that the matter could have been addressed had counsel for the plaintiff before the trial judge taken every objection that it was open to take at that jury trial.  Nonetheless, counsel was put in that position by the conduct of counsel for the defendant.  Minds can vary in the course of a trial, particularly in front of a jury, about the appropriate decision to take.

Did you not have to face this hurdle, that at the conclusion of the very careful analysis of the litany of difficulties created by counsel for the respondent the Court of Appeal came to a conclusion that the probability that the course of justice was substantially affected had been made good?  The Court expressed itself coming to that with considerable hesitation in light of the circumstance that the appellant’s counsel had not moved to have the jury discharged, a full verdict.  It just seems to me difficult to make good a contention that this was outside the proper scope of the exercise of the Court of Appeal’s discretion.

MR STANLEY:   Our concern would be that the Court of Appeal having determined that counsel for the plaintiff was fully cognisant of the effects of the misconduct, the improper questioning and the improper comments in the course of his address – and for that I refer to what was said at paragraph 116 on page 70 – in those circumstances it was really a matter for the plaintiff’s counsel to determine which step he would take.  True it is he was put in that position by counsel for the defendant, but this did not just occur on one occasion.  It did not occur in a situation where the plaintiff could not have, at the luncheon adjournment, in the absence of the jury, raised the matter with the trial judge at any one of these stages, but never was it done with respect to what are the major issues that are the subject of this application.

By way of illustration, counsel’s impermissible cross‑examination of the third party took place on the Thursday.  Defence counsel made his final address, closing address, to the jury on the Friday.  It was not until the Monday that counsel for the plaintiff addressed and he then addressed with a very aggressive response.  He was fighting fire with fire.  He had plenty of time to consider what steps he would take, plenty of time to consider whether to seek a discharge of the jury at that stage. 

At the end of the day, we would say, he was fully complicit in the sense that he was aware of what had happened and he sought to use it for his advantage, and he believed he could.  That has to be the only conclusion, we would submit, that can be drawn from the fact that the plaintiff’s counsel did act as he did in his closing address, and did fail to make any objection during that time. 

One can easily understand counsel being reluctant to make continued objections in matters in front of a jury, but that cannot be an explanation for what happened here.  It went over too long and there clearly would have been too many breaks during the course of the trial when the matters could have been raised in the absence of the jury.

BELL J:   On a number of occasions matters were raised in the absence of the jury and counsel for the respondent indicated he would take the appropriate course and withdraw the offensive remark or what have you and simply did not do that.  Now, the whole position may be very unsatisfactory, but I come back to this.  You have to get over the hurdle that the Court of Appeal, after carefully analysing the whole of the course of the trial, came to the conclusion they did at application book 62, paragraph 141.  You say that was not open to their Honours after taking into account the matters that you point to concerning the forensic choices that the respondent to the application took?

MR STANLEY:   What we say, your Honour, is this, that the court determined that there was a potential for prejudice here and they then went from that step to saying that we draw the inference that there was a miscarriage, that it was unfair.  What we would say is that in considering that question, they really did not take into account the conduct of the counsel for the plaintiff in the way he responded to what had happened during the course of the trial.

This case really, we would say, stands alone.  If you compare it to the other cases, the cases of Smout v Smout, Croll v McRae, Strange v Hybinett, those are cases where the prejudice stands out.  Anyone with any experience at all in jury trials, whether as counsel or as a judge, would instinctively say, that is not on, that is not right, something has gone wrong here.  Then all the more so if they look at the jury verdict and see that it is somewhat inconsistent with the way the evidence has gone, or whether it be an assessment of damages as in the case of Smout.  Intuitively, the court was able to say with great confidence, there has been a miscarriage of justice here because of the conduct of counsel. 

In this case they could not do that, it was with considerable hesitation, and what we say is that before setting aside a judgment of a jury verdict in a situation like this, the court should be very careful because it is going to encourage or it has the potential to encourage the failure to take objections when they should be taken or, indeed, actively utilising comments that are made improperly by opposing counsel for the attempted advantage of the opposing counsel by the opposing counsel.

So that what we say is that when one looks at this case, it really does stand alone and there should be more than facts that would give rise to a competing inference, and then this court has then concluded as a probability that there was a miscarriage.  We would say that here all of the facts simply raise inferences on both sides, conflicting inferences, such that a conclusion that there has been a miscarriage can really only be drawn as a matter of conjecture, not to the required standard.

It is also relevant, we would say, to look not only at the response of counsel for the plaintiff, but also to look at the result of the jury and to bear in mind that counsel for the respondent did not even object until after the verdict.  It was not as though he did not have time to think about it beforehand.  He chanced his arm, he took the risk, hoped for a good verdict, and no doubt thought that his client’s case would be improved as a result of the way he responded to what had been said.  He, indeed, responded in a way that was inappropriate and improper with comments that he made in his closing address.

HAYNE J:   But, indeed, may that not contribute to the evaluation of whether there was a miscarriage of justice?  The trial just went off the rails.  It started to go off the rails when counsel for one side did some things that on their face most certainly should not have been done and never got back on the rails.

MR STANLEY:   Your Honour, it would be easy to find that if the learned trial judge had acceded to the application that was made to her at the end of the trial.  She was in a position to consider all that had happened.  She was there, she had seen the jury and she made a determination.  Now, true it is the Court of Appeal took a different view, but the reality is, she was there and the authorities indicate that very considerable weight should be given to the opinion of the trial judge in these circumstances.

HAYNE J:   The issue you would have us look at is an issue of evaluation?

MR STANLEY:   Yes, your Honour.

HAYNE J:   It is not a question of power.  It is simply evaluating what happened.

MR STANLEY:   What is the level of confidence that is required before one can take this, we would say, extreme step, and it is an extreme step.

HAYNE J:   Yes.  Orders for new trial are to be avoided as often as they can be.

MR STANLEY:   There is every prospect it is going to encourage in later trials counsel sitting quiet when there should be an objection made.

HAYNE J:   Well, nursing points has never been attractive and it is to be hoped if the Court of Appeal’s judgment has any effect, it is to remind any who may need reminding of the need to observe certain standards.  It is to be hoped there are none such.

MR STANLEY:   One would hope that those standards will be observed.  In the real world there is no such thing as a perfect civil jury trial.  There will be mistakes made and errors made, whether by counsel or by the trial judge.  It is a matter of balance, a matter of looking at all the issues and determining how bad is it, what really has happened here?  Do the facts justify the finding that there really has been a miscarriage of justice?  Our case simply is that the test that the Court of Appeal applied was not strict enough.  They looked at the potential for prejudice, and certainly that was there, but then they drew the inference from that that there had been a mistrial, that the trial was unfair.

That is where we part from the Court of Appeal and we would submit that there would have to be a greater level of confidence and this Court should make that clear, so that in the event that errors are made and mistakes are made in the course of civil jury trials, that proper objection is taken and that applications for discharge, if necessary, are made at the time and the matter is simply not left in the situation where, as Chief Justice Latham said in Fitzpatrick’s Case, that the plaintiff simply took his chance, when he lost the trial, he then wanted to have a second go, and the court was unhappy with that course being followed.  If the Court pleases.

HAYNE J:   Yes, thank you, Mr Stanley.  We will not trouble you, Mr Kennan.

Whether there was a miscarriage of justice of trial in this matter required consideration and evaluation of the whole of the course of trial.  We are not persuaded that there are sufficient prospects of demonstrating that the Court of Appeal erred in conducting that examination or demonstrating that the Court of Appeal applied any wrong test in reaching the conclusion that it did.  It is not in the interests of justice generally or in this particular case that there be a grant of special leave to appeal.  Special leave is refused and must be refused with costs.

Adjourn the Court to Friday, 5 June 2009 at 2.15 pm in Sydney.

AT 3.02 PM THE MATTER WAS CONCLUDED