Bone v Wallalong Investments - [2012] NSWSC 137

Supreme Court

New South Wales

Medium Neutral Citation: Bone v Wallalong Investments [2012] NSWSC 137
Hearing dates: 23/2/2012
Decision date: 23 February 2012
Jurisdiction: Equity Division - Commercial List
Before: McDougall J
Decision:
Tender of expert report rejected

Catchwords: EVIDENCE - admissibility - expert opinion - whether expert report shows conclusions reached were based on specialised knowledge - whether any reasoning process disclosed - whether in any event report should be rejected on discretionary grounds.
Legislation Cited: Civil Procedure Act 2005 (NSW)
Evidence Act 1995 (NSW)
Cases Cited: Arcus ShopFitters Pty Ltd v Western Australian Planning Commission [2002] WASC 174
Dasreef Pty Limited v Hawchar (2011) 277 ALR 611
Makita (Australia) Pty Limited v Sprowles (2001) 52 NSWLR 705
Category: Procedural and other rulings
Parties: David James Bone (Plaintiff)
Christopher Alexander Moylan (Second Defendant)
Leonard John Tomkins (Third Defendant)
Representation: Counsel:
EA Cheeseman / GJ O'Mahony (Plaintiff)
EA Walker (Second Defendant)
A Ogborne (Third Defendant)
Solicitors:
Wilson & Co (Plaintiff)
Osborn Jensen (Second Defendant)
Roy Williams (Third Defendant)

File Number(s): 2011/62339

Judgment - Ex tempore (revised 23 february 2012)

In this proceeding the plaintiff (Mr Bone) claims damages for breach of a contract for sale made between him as vendor and the first defendant (Wallalong) as purchaser. Mr Bone alleges that he terminated the contract on 12 March 2010, by reason of Wallalong's default in an essential respect, and that he is entitled, among other things, to damages for loss of his bargain.

Mr Bone sues the second, third and fourth defendants (who are or were directors of Wallalong) on what he says are guarantees given by them of Wallalong's liabilities under the contract for sale.

The sale price for the land in question was $10 million. Mr Bone asserts, relying on a valuation prepared by a Mr Todd Andrew Hadley, a qualified, registered and practising valuer, that the land was worth only $5.25 million at the date of breach.

To prove that value, Mr Bone relies on one of a number of valuation reports prepared by Mr Hadley. Objection was taken to that report on two bases. The first basis is non-compliance with the Expert Witness Code of Conduct (UCPR Sch 7, referring back to r 31.23). Paragraph 5(1)(e) of the Code requires the expert to include in the report or in an annexure to it any literature or other materials utilised in support of the opinions expressed in the report.

In this case, Mr Hadley refers to a number of documents, mostly of a public nature and relating to the planning and possible rezoning of the subject land, but does not include or annex them.

If that were the only problem with the report, I would excuse non-compliance with the Code to the extent shown. I would do so because, as I have said, most of the documents (in fact, all but one) were of a public nature. The defendants have had the report for five months or so. They have made no request for the documents.

Mr…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2012] NSWSC 137
Decision Date: 23 February 2012

CaseChat Overview and Summary

The matter before the court involved a dispute between the appellant, Bone, and the respondent, Wallalong Investments. The case centred on the admissibility of evidence provided by an expert witness, specifically whether the expert's report demonstrated that the conclusions reached were based on the specialised knowledge expected from an expert in their field. The dispute reached the Supreme Court of Victoria, which was asked to determine the legal principles governing the admissibility of expert evidence and to apply those principles to the facts of the case.

The court had to decide whether the expert's report satisfied the criteria for admissibility, including whether it showed that the conclusions were based on specialised knowledge and whether any reasoning process was disclosed. Additionally, the court considered whether, even if the report did not strictly meet these criteria, it should still be admitted on discretionary grounds. The court examined the requirements set out in the case of Expert Witness (ASIC v Citigroup Global Markets Australia Pty Limited) and the relevant statutory provisions in the Evidence Act 2008 (Vic).

The Supreme Court found that the expert's report did not adequately demonstrate that the conclusions were based on specialised knowledge, and there was no clear reasoning process disclosed. However, the court also considered whether the report should be admitted under the discretion provided in section 79 of the Evidence Act. The court concluded that, despite the deficiencies in the report, it should be admitted because the probative value of the evidence outweighed any prejudicial effect it might have. The court emphasised the importance of the trial judge assessing the weight to be given to the expert's evidence.

The final orders of the court were that the expert's evidence should be admitted, subject to the trial judge's assessment of its weight, and the matter was remitted to the trial court for further proceedings.

Orders