Finsbury Print P/L v CPI Graphics - [2007] SASC 131

Supreme Court of South Australia
(Civil: Application)
FINSBURY PRINT P/L & ANOR v CPI GRAPHICS & ORS
[2007] SASC 131
Judgment of The Honourable Justice Debelle (ex tempore)
11 April 2007
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT
REFERENCE BY COURT TO REFEREE
Application for appointment of referee - whether evidence is of such a technical nature to require referee - application dismissed.

EVIDENCE - AFFIDAVITS AND STATUTORY DECLARATIONS - AFFIDAVITS
Application that all parties file affidavits sworn or affirmed by witnesses they intend to call at trial proving evidence to be given by witnesses - whether affidavit evidence was necessary to give parties notice of the plaintiff's claim - application dismissed - plaintiff to provide list of witnesses and expertise or occupation or each witness and issues to be addressed by each witness.

FINSBURY PRINT P/L & ANOR v CPI GRAPHICS & ORS
[2007] SASC 131
Civil

DEBELLE J. There are two applications before the court.
The first is an application that all parties file affidavits sworn or affirmed by the witnesses they intend to call proving the evidence to be given by each of those witnesses. The second is an application that issues in this action be referred to a referee for determination. The applications are made by the first third party to these proceedings.
In this action, the plaintiffs claim damages in respect of an item of plant purchased by it for use in their printing business. The plant is a piece of sophisticated electronic equipment called in the pleadings “the CTP equipment”.
The plaintiffs purchased the equipment from the defendant CPI Graphics Ltd. CPI Graphics Ltd initially joined two third parties, Fuji Film Electronics Ltd and Fuji Photo Film Ltd. It has discontinued the proceedings against the second third party. Thus, the parties to these proceedings are the plaintiffs, the defendant and the first third party.
The plaintiffs plead representations which were alleged to have been made as to the capacity and performance of the CTP equipment, plead the contractual arrangements, plead the defects which occurred and the period over which they occurred. They advance their case on the grounds of the alleged misrepresentations, breach of contract and negligence in the supply and installation of the equipment. The causes of action are breaches of the Trade Practices Act, the Fair Trading Act and the Misrepresentation Act as well as breach of contract and the claim in negligence which I have mentioned. There is a claim for damages for the losses incurred including a claim for alleged loss of profits.
Attached to the statement of claim is a schedule in two parts which contains particulars of the notice given by the plaintiffs to the defendant of the defects and of the attendances by representatives of the defendant to service or maintain the CTP equipment as well as a list of the meetings between the parties in relation to the failure of the machine to perform in the manner represented.
The defence puts these allegations in issue. In addition, it makes a counterclaim for moneys said to be due pursuant to the contract to sell the CTP equipment.
There is also the claim as against the first third party and the defence of that first third party. The first third party has today given notice of an intention to amend its defence.
A number of the representations which the plaintiffs allege were made are admitted. Some are in dispute. In addition, the amended defence which the first third party proposes to file now admits the communication of defects that have previously not been admitted.
The case for the first third party in support of the application for affidavit evidence is grounded on the fact that the equipment is a piece of sophisticated technology made by different manufacturers who are located in different parts of the world. It is said that it will be necessary to call witnesses from different parts of the world to answer the plaintiffs’ claim. The first third party seeks to avoid any delay which might be caused in consequence of either having to locate a witness or to arrange for that witness to be called to give evidence. That is one ground upon which the application is advanced. The other is that the plaintiffs have failed to specify the reasons why the CTP equipment has failed to perform, that is to say, it is alleged that the plaintiffs have not spelled out the causes of that failure to perform.
The statement of claim lists in paragraph 10, sixteen specific instances of what it calls ‘significant operational and technical defects’ which causes the CTP equipment to be defective and not of merchantable quality. Paragraph 10 concludes with two general allegations of the fact that CTP equipment was not free from defects for a period of 24 months and that the defendant failed or neglected to repair the defects. In addition, the statement of claim contains full particulars of correspondence between the plaintiffs and the defendants specifying the defects as well as a number of meetings. The correspondence and the meetings are set out in the two parts of the schedule attached to the statement of claim. That information is also available to the first third party.
The plaintiffs have instructed an expert, a Mr Richard Edwards. He has supplied a report dated 10 March 2006 which has been supplied to the defendant and the first third party. That report identifies operational problems with the CTP equipment and discusses those problems. In some instances, Mr Edwards identifies a cause of the defect. In other instances he states that the cause is unexplained. In the course of dealing with each of the operational problems which he identifies, Mr Edwards lists possible causes.
Mr Lever SC, who appeared for the first third party, criticised Mr Edwards’ report on the ground that it does not address all of those possible causes. Mr Lever also criticised the report on the ground that in the case of certain alleged operational problems, a cause is not identified by Mr Edwards. This, Mr Lever said, was a further reason why it was necessary that there be affidavits of the evidence to be given by each of the witnesses to be called by the plaintiff as well as by other parties.
In my view, Mr Edwards has sufficiently outlined the causes of any defect where he has been able to identify it. To the extent that he is not able to identify a cause it is not necessarily a defect in the report. Whether it is or not will be a matter for later examination. The important fact is that he has identified the operational problems. He has discussed the action which was taken in relation to each problem and in some cases identifies a cause and in other cases he does not. The defendant and the third party are, therefore, fully apprised of the nature of the evidence he would give. Indeed, it is difficult to say what purpose can be served by requiring an affidavit from Mr Edwards as to his evidence. It would simply recapitulate what is already contained in his report.
To the extent that there may be, as there no doubt will be, evidence from other persons as to the occurrence of defects and what action was taken, they are matters which are identified in the communications exchanged between the plaintiff and the defendant of which the first third party has notice. For all of these reasons, the first third party is in a position where it can prepare its case without the necessity for affidavit evidence.
One is always concerned in technical cases of this kind that a party should not be taken by surprise. I think that the particularity contained in the report of Mr Edwards, as well as the particularity in the statement of claim as to the communications of defects and the reports of the defendant as to the measures taken to deal with those defects, means that there will be no element of surprise in this case. However, out of an abundance of caution, I raised with the parties in the course of argument the possibility that the plaintiffs might provide a list of witnesses, their expertise and the topics that those witnesses will be addressing in the course of their evidence. The plaintiffs are prepared to provide such a list. In my view that is a sufficient safeguard for the first third party. For these reasons, I dismiss its application but will order that such a list be provided.
The second aspect of the application concerned the question whether issues should be referred out to a referee for determination. There is no doubt that in appropriate cases it is desirable to refer issues to a referee. This is particularly so where there are issues of a technical nature which may be more expeditiously resolved by experts conferring together or proceeding in some other way to determine the relevant issue. The issues in this case are not, I think, of such a technical nature as to require reference to a referee.
Although these proceedings concern what is a sophisticated piece of electronic equipment, the issues boil down to the fact that it did not operate or otherwise failed to perform in specific and identified ways. The matters discussed by Mr Edwards in his report do not indicate that the issues are so sophisticated that a judicial officer would not be able to properly understand and deal with them.
The defendant has instructed an expert, Mr Gardiner. His reports, when stripped to essentials, state that the equipment did not operate satisfactorily because of a failure by the plaintiffs to operate the equipment properly or to maintain it properly and in accordance with procedures prescribed by the manufacturer. That defence does not, on its face, suggest such a degree of technical sophistication that a judicial officer could not readily understand and deal with the issues. Indeed, it was not contended in argument that the issues were of such a sophisticated nature.
I do not think it appropriate, therefore, to refer the matter out to a referee. The matter should proceed to trial in the ordinary way.
For that reason I dismiss the second part of the first third party’s application.
[After further argument the following orders were made.]
1.That within 28 days the plaintiffs file and deliver a list of witnesses they intend to call, such list stating the expertise or occupation of each witness and the issues to be addressed in the evidence of each witness and the plaintiffs shall give prompt notice of any amendment to the list.
2.That the application of the first third party dated 11 April 2006 be dismissed.
3.That the oral application of the first third party for appointment of a referee be dismissed.
4.That the defendant and first third party are jointly and severely liable for the solicitor’s costs of the plaintiffs of and incidental to the first third party’s application dated 11 April 2006 and for two thirds of the counsel fee of this day.
5.That each party bear its own costs of and incidental to the application to refer issues to a referee.
6. Adjourn to 9.00 am on 28 June 2007.