Commonwealth Director of Public Prosecutions v The Country Care Group Pty Ltd (Ruling No 8)
[2021] FCA 365
•15 April 2021
FEDERAL COURT OF AUSTRALIA
Commonwealth Director of Public Prosecutions v The Country Care Group Pty Ltd (Ruling No 8) [2021] FCA 365
File number: VID 224 of 2019 Ruling of: BROMWICH J Date of ruling: 15 April 2021 Catchwords: EVIDENCE – objection to admissibility of file note of meeting produced under s 155 of the Competition and Consumer Act 2010 (Cth) – file note originally ruled inadmissible during pre-trial hearing – evidence subsequently adduced during trial and on voir dire as to likely authorship of document amongst three people, without identifying the specific author – prosecutor sought to tender file note after this evidence adduced – all three accused object on the basis that file note does not satisfy the requirements of s 69 of the Evidence Act 1995 (Cth) because the person making the relevant representations in the file note could not be identified – further objection on the basis that the evidence should be inadmissible because of unfair prejudice exceeding probative value per s 137 of the Evidence Act – held: objection rejected as to admissibility under s 69 – held: no danger of unfair prejudice in admitting file note including relevant representations Legislation: Competition and Consumer Act 2010 (Cth) s 155
Evidence Act 1995 (Cth) ss 44, 59, 60, 69, 137, 183
Cases cited: Australian Competition and Consumer Commission v Air New Zealand Ltd (No 1) [2012] FCA 1355; 207 FCR 448
Australian Securities and Investments Commission v Flugge (No 10) [2015] VSC 690
Capital Securities XV Pty Ltd (formerly known as PrimeCapital Securities Pty Ltd) v Calleja [2018] NSWCA 26
Lee v Minister for Immigration & Multicultural Affairs [2002] FCA 303
Lee v The Queen [1998] HCA 60;195 CLR 594
Lin v Tasmania [2012] TASCCA 9
Subramaniam v Public Prosecutor [1956] 1 WLR 965
Division: General Division Registry: Victoria National Practice Area: Federal Crime and Related Proceedings Number of paragraphs: 53 Date of last submission: 29 March 2021 Date of hearing: 15 March 2021 - 1 June 2021 Date of submissions on this ruling: 12, 26, 29 March 2021 Counsel for the Prosecutor: O Bigos QC, R Barry, A Muhlebach, S Tatas Solicitor for the Prosecutor: Commonwealth Director of Public Prosecutions Counsel for the First Accused: K Morgan SC, P Strickland Counsel for the Second Accused: D Jordan SC, S Keating Solicitor for the First and Second Accused: HWL Ebsworth Lawyers Counsel for the Third Accused: D Staehli SC, C Bannan Solicitor for the Third Accused: Mills Oakley
VID 224 of 2019 BETWEEN: COMMONWEALTH DIRECTOR OF PUBLIC PROSECUTIONS
Prosecutor
AND: THE COUNTRY CARE GROUP PTY LTD
First Accused
ROBERT MARTIN HOGAN
Second Accused
CAMERON JOHN WILLIAM HARRISON
Third Accused
REASONS FOR RULING
BROMWICH J:
On Friday, 12 March 2021, prior to the empanelment of the jury on Monday, 15 March 2021, I heard legal argument and gave rulings on the admissibility of four documents sought to be tendered in the trial by the prosecutor, to which all three accused objected. Among them was a document which had been produced to the Australian Competition and Consumer Commission (ACCC) by the first accused, The Country Care Group Pty Ltd, in answer to a notice issued by the ACCC under s 155 of the Competition and Consumer Act 2010 (Cth). That document was referred to for convenience on 12 March 2021 as “Document 57”, being the proposed tender bundle tab number. In the trial, that document has since been marked for identification “MFI-P”, and will be referred to by that identification in these reasons. These reasons constitute the adjudication of the re-tender of MFI-P by the prosecutor in light of evidence adduced during the course of the cross-examination of a prosecution witness in the trial, Mrs Watson, including upon a key document that was tendered and admitted into evidence.
On its face, and having regard to its source, MFI-P appears to be an internal Country Care file note of a 15 July 2014 meeting between unspecified persons from the Department of Veteran’s Affairs (DVA) and unspecified persons from Country Care, because the document is headed “15/07/2014 DVA Meeting Melbourne”. The document also has internal headings within it that are consistent with it being some kind of record of a meeting, namely “Agenda Item 1”, “Agenda Item 2”, “Agenda Item 3”, “Agenda Items 4 and 5” and “New Business – Rob”. MFI-P also bears the words at the top “Modified: Thu 17/07/2014 7:55 AM” which readily supports the inference that the document was at least prepared, at least in its current form, by that date and time, making it reasonably contemporaneous to the date of the meeting to which it refers. For those reasons, MFI-P meets the description for the first stage of admitting a document as a business record in s 69(1) of the Evidence Act 1995 (Cth), but leaves to be met the hearsay exception as to representations in s 69(2). All further references in these reasons to ss 44, 59, 60, 69, 137, 183 are references to provisions of that Act.
The entry including “Rob” in MFI-P, might readily enough be inferred to be a reference to the second accused, Mr Robert Martin Hogan, who the evidence in the trial makes clear is referred to as “Rob”. Mr Hogan was and remains the managing director of Country Care. However, that falls short of identifying Mr Hogan as an attendee at the meeting. No attendee at the meeting is expressly identified in MFI-P itself.
The argument on 12 March 2021
The original argument for admitting MFI-P made by the prosecutor on 12 March 2021 was on the basis of it being a document that could be sufficiently identified on its face to be admissible into evidence for a non-hearsay purpose, in effect relying upon it as a business record for the purposes of s 69(1), but not as an exception to the hearsay rule per s 69(2) and therefore not as evidence of the truth of any representation contained within it. The prosecutor reasoned that it was a record of a formal meeting, with agenda items 1, 2, 3, 4 and 5, and with the reference to “New Business – Rob” suggesting that it was an important meeting.
The prosecutor submitted that it could be inferred that either Mr Hogan attended the 15 July 2014 meeting with the DVA, which was Country Care’s major client, or he was otherwise informed about what was discussed at the meeting. The prosecutor also submitted that because the document was from Country Care’s records, the third accused, Mr Harrison, could also be taken to know about the contents of it and that it was, therefore, relevant to his state of mind. The contents of the entire document were sought to be relied upon as a record of the discussion that had taken place with the DVA at the meeting.
Counsel for Mr Hogan, joined by counsel for Country Care and for Mr Harrison, with some additional arguments, made it clear that issue had been taken with MFI-P being a business record because of difficulties in meeting the requirements of s 69(2), and additionally under s 137 because of the asserted danger of its probative value being outweighed by the risk of unfair prejudice.
The substance of the objections taken on 12 March 2021 may be summarised as follows:
(1)MFI-P does not identify who attended at that meeting, either from the DVA or from Country Care.
(2)MFI-P does not identify whether Mr Hogan, Mr Harrison or Ms Watson (nee Aitken) was present.
(3)In order to be able to use MFI-P to prove state of mind it would be necessary for the prosecutor to identify who wrote the note, being someone’s subjective perception of what was discussed, potentially together with mixed observations of their own thoughts and feelings about what was discussed. That submission necessarily only really applies to aspects of MFI-P that do not record something that was said at the meeting, because anything that was said is readily able to go to the state of mind of a person present when it was said.
(4)It could not be readily known who the person speaking on aspects of those topics recorded in MFI-P was, creating a risk of unfair prejudice by reason of misuse of the evidence by the jury by ambiguity as to whose assertion was being recorded. Examples drawn from under the heading “Agenda Items 4 and 5” were provided. This has since emerged as the key material from MFI-P.
(5)Impliedly at least, MFI-P was being used for a hearsay purpose, because an inference is sought to be drawn as to at least Mr Hogan and perhaps Mr Harrison being present at the meeting, which is an inferential assertion as to truth. This submission perhaps overlooked the operation of s 69(2A), which expressly places unintended assertions of fact outside the operation of the hearsay rule, but nothing turns on this in light of subsequent developments.
In response to the prosecutor’s further submissions recorded below, it was later submitted by Mr Hogan that it is necessary to show by way of direct or indirect evidence that he (and by parity of reasoning, Mr Harrison) actually knew of the contents of the this note, rather than just that they must have known. This was said to be because it would be entirely speculative for the jury to be invited to assume, as the following argument by the prosecutor suggested, that either of the natural person accused was told by some person the precise content of this note in the absence of any evidence of that kind. This further argument turned on MFI-P not being shown to be a record of a meeting attended by either Mr Hogan or Mr Harrison.
The prosecutor further submitted on 12 March 2021 that it was not necessarily the case that Mr Hogan or Mr Harrison were at the meeting, but rather that either they were at the meeting or it must be inferred that they were informed about it. This was because of the seniority of Mr Hogan as Country Care’s managing director and of Mr Harrison as Country Care’s business development manager, and because it was a formal meeting with the DVA, a key client of Country Care, with an agenda and agenda items. It was therefore sought to be inferred that either they attended, or they at least knew about the content of what occurred at the meeting by being informed about it afterwards, because there could not be a formal meeting with the DVA without their involvement.
The prosecutor made it clear that the discussion under agenda items 4 and 5 referred to concerns, whether being expressed by DVA to Country Care, or Country Care to DVA, about significant price disparities across suppliers for the same items, which is a live issue in relation to charges 1 to 3 in the indictment, as detailed further below. The prosecutor submitted that those concerns were expressed at the meeting and must have come to the attention of Mr Hogan and Mr Harrison, either through their attendance at the meeting or otherwise. The prosecutor further submitted that in order to prove their state of mind through MFI-P it was not necessary to identify precisely who wrote the document. It might have been written by someone other than Mr Hogan or Mr Harrison, but it could be taken, because of the importance of the issues apparently discussed and their significant roles in the company, that they knew what was discussed. I note that at the time of this meeting, Mr Harrison was not yet the business development manager at Country Care, diminishing the strength of this aspect of the prosecutor’s argument in respect of him.
During the course of the argument, I expressed the view that if the prosecutor had any direct or circumstantial evidence that Mr Hogan and/or Mr Harrison saw or otherwise accessed this document, the rest of the arguments advanced would probably flow through to being admissible evidence of the state of mind of either of them so informed, but that the basis for inferring they were present at the meeting or otherwise knew about the contents of the document was speculative. At that stage, there was no direct or reasonably cogent circumstantial evidence that MFI-P was a record of what took place at a meeting attended by Mr Hogan and/or Mr Harrison.
The strongest argument for the accused on 12 March 2021 was the absence of sufficient evidence to prove, even inferentially, that either Mr Hogan or Mr Harrison was present at the meeting or was otherwise in a position to have been told or know what had been said by or in the presence of those who attended, so as to be capable of being evidence of the state of mind of either of them, or at least safely so. As will be seen, that basis for objection has largely fallen away because of evidence that has emerged at the trial.
I ultimately ruled against the admission of MFI-P (and another document) on 12 March 2021 because I was not satisfied at that time that the prosecutor had gone far enough to attribute knowledge to Mr Hogan or Mr Harrison of the contents of those two documents so as to be evidence going to their state of mind. While there was an inference available as to the presence of Mr Hogan at a meeting with the DVA on 15 July 2014, that inference was tenuous. There was even less evidence in relation to Mr Harrison.
The weakness of the inference also went to its probative value, because of the limited extent to which a conclusion could be drawn that Mr Hogan or Mr Harrison was aware of the contents. That, therefore, was also relevant when evaluating the comparative danger of unfair prejudice for the purposes of s 137. The tender was therefore rejected at that time even for a non-hearsay purpose. Plainly enough, the situation was left upon the basis that further or better evidence might or might not emerge during the trial to support the re-tender of MFI-P, whether for a hearsay or non-hearsay purpose.
Evidence subsequent to 12 March 2021
During the course of cross-examination of the first witness for the prosecution, senior counsel for Country Care showed Mrs Brooke Watson (in 2014 known as Brooke Aitken) an email which was tendered and admitted as exhibit 4A-1 tab 29, without objection. The email was sent by Mr John Dafilis of the DVA to Mr Hogan, cc to Mrs Watson, at 9.43 am on Monday, 14 July 2014, attaching an agenda for a meeting between the DVA and Country Care the next day, 15 July 2014 at 10.00 am (the 15 July 2014 meeting agenda and the covering email). That email with its attachment was forwarded by Mr Hogan to Mr Harrison at 9.32 am on Tuesday, 15 July 2014 (forwarding email), also forming part of that exhibit.
The text of the 15 July 2014 meeting agenda is as follows:
AGENDA ITEMS
COUNTRY CARE GROUP SIX MONTHLY MEETING
TUES 15th July 2014 @ 10.00am
Via Video Conference
DVA - John Dafilis
- Tony Spano
- Kon Semitekolos
COUNTRY CARE - Rob Hogan
- Brooke Aitken
- Cameron Harrison
DVA AGENDA ITEMS
Item 1 – John - CCG Performance, Reports etc
- Traffic Light Report
- Audit 50 DOFS
Item 2 – Michele - Lost Equipment Spreadsheet
Item 3 – Tony - The Schedule Changes, new products, Dementia Items.
Item 4 – Tony - The Next MFS Tender
Item 5 – Tony - PWC Review
Item 6 – John - Distribution of work from CCG
Item 7 – John - Other BusinessCOUNTRY CARE GROUP
Item 1 – Rob - Lift Chair Prescription Changes
Item 2 – Rob - Aged Care Facilities Changes to High Low Care
Item 3 – Rob - Updated sub-contractor list
Item 4 – Rob - Update on Marketing ActivitiesItem 5 – Rob - Update on proposed dates and venues for National Expo’s, DVA’s ability to present to Health Providers. Topics to cover.
In cross-examination in relation to the 15 July 2014 meeting agenda and the covering email, Mrs Watson:
(1)agreed, by reference to a comment in the immediately preceding exhibit, being a chain of emails sent on Friday, 11 July 2014, that the meeting with the DVA on Tuesday, 15 July 2014 was one of the regular six-monthly meetings she, and perhaps in context, Country Care, had with the DVA;
(2)agreed that she recognised the covering email chain of 14-15 July 2014 attaching the agenda for the meeting;
(3)agreed that the attachment was a list of agenda items for Country Care Group six-monthly meetings;
(4)said that she knew the representatives of the DVA, Mr Dafilis, Mr Spano and Mr Semitekolos;
(5)said that Mr Spano spoke to Item 4, being the next MFS (Mobility and Functional Support) tender and confirmed that this was a reference to the 2015 DVA tender;
(6)recalled, upon prompting, that the reference in Item 5, “PWC Review” was a reference to the accounting firm PricewaterhouseCoopers being asked to do a benchmarking report for DVA, and recalled being involved for Country Care with a response to DVA’s request for assistance in relation to that benchmarking, but did not otherwise recall the content of the discussion; and
(7)agreed in relation to agenda item 5 on the second page of the 15 July 2014 meeting agenda, under the heading Country Care Group, that the DVA attended the national expos referred to in that item.
The re-tender of MFI-P and the evidence from Mrs Watson on the voir dire
At the conclusion of Mrs Watson’s evidence, the prosecutor initially sought to re-open the evidence-in-chief, which was opposed. That application did not need to be determined because the prosecutor ultimately sought only to re-examine Mrs Watson in relation to her evidence in cross-examination about the 15 July 2014 meeting agenda and the covering email. In particular the prosecutor sought to ask her questions about MFI-P upon the basis of using it to refresh her memory as to what had been said at the meeting. That too was opposed upon the basis that Mrs Watson could not refresh her memory by reference to a document that she was not shown to be the author of (although this might have been covered by a contemporaneous adoption, but this was not suggested to have taken place): see s 44.
Ultimately, Mrs Watson gave evidence on this topic and certain other matters on the voir dire. Relevantly, she identified MFI-P as notes from the 15 July 2014 meeting, said that it recorded things said during that meeting, and said that the author of the notes was either herself, Mr Harrison or Mr Hogan. In my view, that evidence confirms (but does not materially go further than) what can readily be gleaned from reading MFI-P with and in the context of the 15 July 2014 meeting agenda, the covering email, the forwarding email, and the evidence given by Mrs Watson in the presence of the jury.
The present argument
The following morning, 29 March 2021, the tender of MFI-P was pressed, opposed and argued. As the argument unfolded the key passages of MFI-P were identified. The particular representations ultimately relied upon by the prosecutor are emphasised in bold below, with the discussion generally corresponding to the topic in Agenda Item 4 in the 15 July 2014 meeting agenda, namely “The Next MFS Tender”:
Agenda Items 4 and 5:
Ideas from us on what areas of the contract can do with amendments or improvements,
Rural/remote areas are main concern, as expected. DVA open to ideas on how to amend this.
Concerned about significant price disparities across suppliers for the same items. As [sic] considering fixing a price if this is not sorted. Prices will be negotiated with us. Not keen to fix prices, but may need to take this step. Sometimes 30-40% differences in price.
Acknowledge that market prices are often cheaper, but DVA are paying a premium to have the service side of things attached to their products.
Adjusting prices may fix up rural/remote issues, but will provide a bonus to metro. Not ideal. More likely to fix up delivery prices for rural/remote to avoid price changes.
We will put together a package of ideas for DVA over the next few months. New tender comes around sometime next year. Usually August, probably earlier this year to allow for better negotiations. Products for a year, supply for Tony@ DVA. We want to cull some products that we rarely or never sell and even ·add some new product.
The prosecutor argues that MFI-P:
(1)forms part of the business records of Country Care, so satisfies s 69(1)(a) of the Evidence Act; and
(2)contains a previous representation made or recorded in the course of or for the purposes of the business, being the matters discussed under the various agenda items of the meeting, so satisfies s 69(1)(b) of the Evidence Act.
The key passages of MFI-P relied upon by the prosecutor (identified above at [20]) concern discussion about significant differences between prices charged by different suppliers under the DVA contract, and what might be done about it. The significance of this is best appreciated by reproducing the particulars of the alleged cartel provision in the indictment, noting that the charged period for both charges 1 and 2 brought against Country Care and Mr Hogan are between about 13 May 2014 and about 4 May 2016, and the meeting to which MFI-P refers took place on 15 July 2014:
That “members” of the Country Care Group would not advertise for sale goods that The Country Care Group Pty Ltd contracted with the Department of Veterans Affairs to sell under the Mobility and Functional Support Tender at below the contracted prices.
In substance, MFI-P likely goes to the prosecution case that the alleged cartel provision was sought to be implemented by way of an arrangement or understanding between Country Care Group members (that is, subcontractors to Country Care for the purpose of fulfilling contractual obligations under the DVA tender contract) in order to stop DVA becoming aware of lower prices being advertised on member websites, and thereby prevent DVA contract prices being reduced to reflect lower market prices of tender goods being sold to members of the public, including private hospitals and nursing homes.
The prosecutor places reliance on the evidence from Mrs Watson summarised above that MFI-P was prepared by one of the three attendees of the meeting for Country Care, being herself, Mr Hogan and Mr Harrison, each of whom had a personal knowledge of the matters discussed at the meeting, or recorded something said by someone else present whom it could be inferred had such personal knowledge, as well as personal knowledge of what was said at the meeting more generally. The prosecutor submits that it is not necessary to identify the precise person who made the representation or who was the author. Reliance is also placed on inferences able to be drawn in accordance with s 183 of the Evidence Act, which allows the Court to draw reasonable inferences from the face of a document and from other matters from which inferences may properly be drawn. The prosecutor submits that MFI-P is of a significant probative weight and that there is no unfair prejudice for the purposes of s 137.
All three accused in substance submit, or adopt submissions that the identification of the specific person making each representation in the file note relied upon is of paramount and indispensable importance to the admissibility of MFI-P, and that this needed to be able to be done on the face of the document. Counsel for Country Care submit that the formatting of the document meant that the relevant representations were not sufficiently “split out” so as to ascertain the source of each representation, and that while the case authorities did not indicate a requirement to identify the person making the representation, the specific source of the representation needed to be identified on the face of MFI-P. Similarly, counsel for Mr Harrison (with similar language used by counsel for Mr Hogan) submit that the statements represented a blend of matters in the mind of the author of the document.
Counsel for Mr Hogan further submits that three critical questions have to be asked in considering whether this document should be admitted: what was the previous representation; what is the asserted fact relied upon; and, who was the person who had personal knowledge of the asserted fact? It is submitted that because that information could not be identified on the face of MFI-P, the requirements of s 69(2) could not be met, and MFI-P could not therefore, in any probative way, support assumptions made on the basis of the representations contained therein.
The argument for exclusion under s 137 turns, in substance, upon the asserted danger of unfair prejudice that is said to arise from the risk that the jury may attribute things derived from MFI-P as statements made by Mr Hogan, statements made by Mr Harrison, or statements made on behalf of Country Care, when what is recorded may well have been a statement made by the DVA.
Consideration
The dispute turns on the meaning and application of s 69(2), in the context of s 69(1) and s 69(5), although the prior argument for admission of MFI-P for a non-hearsay purpose as made on 12 March remains, which is part of the reason why those arguments are reproduced above. These relevant three subsections are as follows:
(1) This section applies to a document that:
(a) either:
(i)is or forms part of the records belonging to or kept by a person, body or organisation in the course of, or for the purposes of, a business; or
(ii)at any time was or formed part of such a record; and
(b)contains a previous representation made or recorded in the document in the course of, or for the purposes of, the business.
(2)The hearsay rule does not apply to the document (so far as it contains the representation) if the representation was made:
(a)by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact; or
(b)on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact.
…
(5)For the purposes of this section, a person is taken to have had personal knowledge of a fact if the person’s knowledge of the fact was or might reasonably be supposed to have been based on what the person saw, heard or otherwise perceived (other than a previous representation made by a person about the fact).
An “asserted fact”, as referred to in s 69, is a fact that it can reasonably be supposed the person making a representation intended to assert: see ss 59(1) and (2). It is only such a fact that cannot be proven by hearsay evidence in the absence of an exception to the hearsay rule, such as s 69. If any part of a document contains a representation that does not convey such an asserted fact, that representation is not hearsay and is not inadmissible for that reason. A fact that a person did not intend to convey, such as an implied representation, is also not caught by the hearsay rule and therefore is not inadmissible on that account either: see s 59(2A).
Nor is anything not relied upon for a non-hearsay purpose caught by the hearsay rule, such as evidence relied upon to prove that something was said, but not the truth of any assertion made. As the Privy Council observed in Subramaniam v Public Prosecutor [1956] 1 WLR 965 at 970 (and as adopted and cited by numerous courts in Australia, including the Full Court of the Federal Court):
Evidence of a statement made to a witness by a person who is not himself called as a witness may or may not be hearsay. It is hearsay and inadmissible when the object of the evidence is to establish the truth of what is contained in the statement. It is not hearsay and is admissible when it is proposed to establish by the evidence, not the truth of the statement, but the fact that it was made. The fact that the statement was made, quite apart from its truth, is frequently relevant in considering the mental state and conduct thereafter of the witness or of some other person in whose presence the statement was made.
The limitation at common law is that evidence admitted for a non-hearsay purpose cannot, once admitted, be used for a hearsay purpose. That common law position was reversed by s 60, subject to the limitation identified in Lee v The Queen [1998] HCA 60;195 CLR 594 at [29] that this provision does not operate to convert into evidence of a fact something that the source did not intend to assert.
The first point to note about MFI-P, when considered in the context of the 15 July 2014 meeting agenda and the references in it to what are plainly some of the same agenda items, is that it is clear that it is a record of Country Care of what took place at that meeting, satisfying the requirement in s 69(1)(a). As noted above, this was already apparent on the face of MFI-P having regard to its source.
The second point to note is that, in light of Mrs Watson’s evidence before the jury and the 15 July 2014 meeting agenda about which she gave evidence, it is clear that she along with Mr Hogan and Mr Harrison attended a meeting on behalf of Country Care on 15 July 2014.
The third point to note is that it is clear from the evidence adduced during the course of the cross-examination of Mrs Watson, and aided by a plain reading of the passages from MFI-P reproduced above, that consistently with the 15 July 2014 meeting agenda, Mr Tony Spanos (listed as a DVA attendee in the exhibited agenda) spoke to DVA agenda item 4 (and, given the way those items are grouped in MFI-P, most likely also DVA agenda item 5, although nothing seems to turn on that), and that a conversation appears to have ensued. Part of MFI-P appears to record what was said during the course of that conversation, and it is plain enough that this was recorded in the document both in the course of, and for the purposes of, Country Care’s business, being produced by Country Care in response to the ACCC s 155 notice. The requirements of s 69(1)(b) have therefore been met. This was not seriously disputed.
The substance of the present debate turned on s 69(2) and also the question of whether the danger of unfair prejudice outweighed the probative value of MFI-P. For s 69(2) to be met, it is necessary for the Court to be satisfied that each relevant representation was made “by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact or on the basis of information directly or indirectly supplied” by such a person: see Capital Securities XV Pty Ltd (formerly known as PrimeCapital Securities Pty Ltd) v Calleja[2018] NSWCA 26 at [87] per Leeming JA (with whom Basten and Gleeson JJA agreed).
As Leeming JA also pointed out in Calleja at [89], s 69(2)(a) and (b) and (5) all refer to “or might reasonably be supposed to have had personal knowledge” of a fact that is asserted by a representation, describing it as well settled by reference to authority that those words “indicate that the Court is allowed to draw inferences not just from the form of the document, but from the nature of the information contained in it”. His Honour added at [91] that s 183 could be relied upon to draw such inferences, a point that was overlooked at trial in that case. It is therefore not necessary to go so far as to find that a source of a representation did in fact have personal knowledge of the fact asserted.
In that context, it is important that MFI-P was a record of what had been said at a regular, six-monthly, meeting between representatives of Country Care and representatives of the DVA. On any reasonable view, this was a serious, important and reasonably formal business meeting between representatives of two sides of a substantial and valuable contractual relationship. The meeting and what was said at it is highly likely to have been taken seriously by each participant, as is reflected by both the agenda items and the contents of MFI-P. Each attendee, it may readily be inferred, was attending as someone with relevant knowledge and experience pertinent to one or more of the topics on the agenda circulated in advance. Each attendee, of which there were only six, may readily be inferred to have been in possession of relevant facts on one or more of the agenda items to be discussed or contributed to by one or more attendee. Each person present may reasonably be supposed to have personal information of facts asserted at that meeting by any of them, of which, I readily infer, the most important parts, from the point of view of the author as a representative of Country Care, were recorded in MFI-P.
It is also relevant that, based on Mrs Watson’s oral evidence and the 14 July 2014 meeting agenda, I can infer that the only viable author of MFI-P was one of Mr Hogan, Mr Harrison or Mrs Watson. No basis has been advanced for suggesting that any representation recorded was made other than by a person who may reasonably be supposed to have had personal knowledge of a fact asserted by that representation during the course of the meeting.
The primary submission advanced by all three accused was that the representations within the file note could not be attributed to any particular person. A number of authorities considering this issue, both in civil and criminal contexts, make it clear that under s 69 it is not necessarily required that the person who made the representation or who supplied the information upon which it was based be specifically identified: see, e.g., Lin v Tasmania [2012] TASCCA 9 at [87] (noting that this decision was overturned on appeal, but not for any reason relating to the admissibility of evidence); and Lee v Minister for Immigration & Multicultural Affairs [2002] FCA 303 at [22]. Lin and Lee were generally endorsed in Calleja at [89] and [108] respectively. To the extent that it was submitted it was unclear whether representatives from Country Care or the DVA made the representations recorded in MFI-P, I also note that the rule in s 69 has been found to go as far as to extending to records and statements by other organisations as being evidence admissible as a business record: Australian Competition and Consumer Commission v Air New Zealand Ltd (No 1) [2012] FCA 1355; 207 FCR 448 at [47]-[50]. It is also instructive to have regard to the careful approach and analysis by Robson J in Australian Securities and Investments Commission v Flugge (No 10) [2015] VSC 690 of a broadly similar meeting note, especially at [29(5)] and [45]-[52].
MFI-P was therefore:
(1)a record of representations made by the author, and to the extent that any such representation asserts a fact, on the basis of facts that may reasonably be supposed to be known by the author; or
(2)a record of representations made by another person present, on the basis of facts that may reasonably be supposed to be known by that person.
Not every representation in MFI-P was as to a fact, let alone an asserted fact, but the key and contentious representations identified above readily meet that description. It is not necessary that every representation in a document satisfy s 69(2). As was pointed out in Calleja at [103], “the question raised by s 69(2) goes to the nature of the particular representation sought to fall outside the hearsay rule”, a topic to which I now turn.
During the course of the present argument, the prosecutor identified certain intended assertions of fact that were sought to be relied upon to advance the prosecution case by reference to the bold part of the text of MFI-P reproduced above at [20]:
Concerned about significant price disparities across suppliers for the same items. As [sic] considering fixing a price if this is not sorted. Prices will be negotiated with us. Not keen to fix prices, but may need to take this step. Sometimes 30-40% differences in price.
Acknowledge that market prices are often cheaper, but DVA are paying a premium to have the service side of things attached to their products.
In context, I would be inclined to read the word “As” at the end of the first line above as “Are”, to make sense of the second sentence.
Importantly, the exception to the hearsay rule only applies to the representation sought to be relied upon, not to the document containing it. However, that does not prevent the representations being relied upon for a non-hearsay purpose, here going to the state of mind of Mr Hogan and Mr Harrison as persons present at the meeting and being able to hear what was recorded as being said at the meeting. MFI-P is admissible at least to that more limited extent, as originally argued on 12 March 2021, as going to the state of mind of Mr Hogan and Mr Harrison, subject to exclusion by reason of s 137.
The live question, also subject to s 137, is therefore whether MFI-P is also admissible as evidence of the truth of any facts intended to be asserted by the representations during the course of the meeting; and alternatively, whether there is any reason that s 60 should not operate according to its terms to make those representations evidence of the truth once admitted for a non-hearsay purpose.
I consider that it is reasonably open to read the two key passages as recording first what was said by a representative of the DVA, most likely Mr Tony Spano (per the evidence of Mrs Watson, summarised above); and then the response given by a representative of Country Care, most likely Mr Hogan as the managing director, a primary shareholder, and most senior person present, but possibly Mrs Watson or Mr Harrison. Thus it is open to the prosecutor to contend that representations to the following effect were made by the following identifiable persons:
(1)a DVA representative, most likely Mr Spano, expressed concerns held by the DVA about the fact of significant price disparities existing, in context between different Country Care Group members, sometimes being as much as 30-40%, and the possible solution that the DVA would prefer not to implement, but may be necessary, namely fixing prices; and
(2)a Country Care representative, most likely Mr Hogan (or alternatively, Mrs Watson or Mr Harrison), countered by acknowledging that while market prices are often in fact cheaper, in context referring to prices for supplies to the general public, the DVA were paying a premium for the superior service provided to DVA clients.
I am satisfied that the requirements of s 69(2) have been met for those two intended assertions of fact.
As to the question posed by s 137, I do not accept that upon a proper evaluation of the representations sought to be relied upon, they give rise to any unfair prejudice, let alone such a degree of prejudice that cannot be corrected, if needs be by a direction. The jury will doubtless receive competing submissions as to what to make of the two key passages in MFI-P. In the context of the issues in this trial, what really matters is that the fact of differences in prices charged by suppliers was expressed to be a material concern to the DVA, with the attendant risk, as expressly flagged, of DVA prices being fixed (and in context, thereby lowered).
The substance of the prosecution case on charges 1 to 3 in the indictment is that Country Care and Mr Hogan sought to avoid that risk materialising by attempting to induce Country Care Group members to make an arrangement or arrive at an understanding to prevent that from happening by not advertising lower prices online so as to reveal that difference, and that Mr Harrison aided, abetted, counselled or procured Mr Hogan in the commission of his charged offence. The additional evidentiary value of those two passages being admitted not just as hearsay evidence of what was said in the presence of Mr Hogan and Mr Harrison, but also as non-hearsay evidence of the truth of the representations made, is because it goes to concerns being expressed by the DVA as to the problem with the asserted fact of price disparity and what might be done about it. I consider that it is reasonably open for the jury to find that these representations constituted both Mr Hogan (and through him, Country Care) and Mr Harrison being made aware of this concern, and the factual basis for it, as well as the possible remedy in contemplation, being in context the lowering of DVA prices to address the price difference.
In the circumstances I therefore consider that the probative value of these two key passages is high. I also consider that the jury is capable of undertaking the exercise of carefully considering the evidence in its full context, considering submissions made about that evidence, and arriving at their own conclusion as to the meaning of the two key passages in MFI-P. That may or may not align with the inferences as to authorship and meaning that I have arrived at above for the sole purpose of determining admissibility. What weight the jury might give to these representations, and how they may be persuaded to read the document and interpret these representations, is a matter for them, which can be addressed in submissions. However, I cannot see why it is unfairly prejudicial to allow the jury to receive and assess this evidence given the clear connection it has both to the facts in issue and to evidence which has already been adduced in the trial.
Even if I was wrong about the above conclusion, I am unable to see why s 60 should not operate according to its ordinary terms, given that MFI-P is clearly admissible for a non-hearsay purpose.
Conclusion
MFI-P is admissible, and specifically the two passages identified at [42] above are admissible for a hearsay purpose under s 69(2) to the extent that they contain asserted facts. Further, the grounds for exclusion under s 137 are not made good because, properly considered, there is no real danger of unfair prejudice, and certainly none that is not comfortably outweighed by the probative value of those two passages. MFI-P will therefore be admitted as Exhibit 1P tab 313.
I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Ruling of the Honourable Justice Bromwich. Associate:
Dated: 15 April 2021
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