Flitcroft v Cassidy Constructions Pty Ltd t/as Buildscene

[2023] NSWCATCD 26

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Flitcroft v Cassidy Constructions Pty Ltd t/as Buildscene [2023] NSWCATCD 26

Hearing dates:

13 March 2023

Date of orders:

15 March 2023

Decision date:

15 March 2023

Jurisdiction:

Consumer and Commercial Division

Before:

R C Titterton OAM, Senior Member

Decision:

1. The applicant’s application to file the supplementary report of Mr Kyle and for ancillary orders is dismissed.

2. If the respondent seeks costs, it should file submissions within 14 days. Those submissions must identify the relevant costs rule, and the reason why the respondent says it is entitled to costs.

3. The applicant may respond within a further 14 days.

4. The respondent may reply within a further 7 days.

5. The hearing date of 4 April 2023 is confirmed.

Catchwords:

PRACTICE AND PROCEDURE – application to reopen expert evidence component of proceedings – application refused

Legislation Cited:

Civil and Administrative Tribunal Act 2013 (NSW) - ss 38(2), 38(5)(c) and 38(6)(a)

Cases Cited:

Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175

Bailey v Palombo [2020] NSWSC 1209

Bao Long Guo t/as GD Brother Projects v GB Electrical Services Pty Ltd [2020] NSWCATAP 131

EB v CT (No 2) [2008] QSC 306

Reid v Brett [2005] VSC 18

Smith v New South Wales Bar Association (1992) 176 CLR 256

Category:

Procedural rulings

Parties:

First Applicant: Julian Flitcroft
Second Applicant: Margaret Flitcroft
Respondent: Cassidy Constructions Pty Ltd t/as Buildscene

Representation:

Counsel:

Applicants: S Blackman
Respondent: A Munro

Solicitors:

Applicants: Contracts Specialist
Respondent: G R Gorrie & Co Pty Ltd t/as GRG Lawyers

File Number(s):

HB 22/27326

Publication restriction:

Nil

REASONS FOR DECISION

Introduction

1. This matter was listed for hearing on 8 February 2023 and adjourned part-heard that day, following the conclusion of the expert evidence.

2. The hearing resumes on 4 April 2023.

3. By application filed 7 March 2023 the applicants seek orders that:

• leave be granted to file with the Tribunal and serve on the respondent a supplementary statement of Mr Aaron Kyle dated 22 February 2023;

• the respondent have leave to file with the Tribunal and serve on the applicants any report of Mr Nakhla, the respondent's retained building expert, in reply to the supplementary statement of Mr Kyle by 31 March 2023;

• the applicants pay the respondent's costs on an ordinary basis thrown away for the respondent's expert's cost to reply as agreed or assessed;

• the parties are to inform each other by 3 April 2023 if they require Mr Nakhla or Mr Kyle for further cross-examination;

• Mr Nakhla and Mr Kyle have leave to appear by AVL or telephone if required for further cross-examination;

• the 4 April 2023 hearing date is confirmed.

4. The application is opposed by the respondent.

5. For the following reasons, the application is dismissed.

Applicant’s materials and submissions

Materials

6. The applicants filed the following documents with the Tribunal on 7 March 2023.

7. First a letter to the Tribunal. Relevantly, the letter states:

3. The Applicant's independent expert witness, Mr Aaron Kyle, has changed his opinion on a material matter after providing his report. Mr Kyle has produced the Supplementary Statement, attached to this letter.

4. In accordance with the Guiding Principles and the CAT Procedural Direction 3, the Applicants seek leave to file and serve the Supplementary Report. This is the Applicants application for leave.

…

Objection from the Respondent

8. We have communicated with the Respondent's solicitor prior to sending this letter. The Respondent's solicitor objects to the above request and proposed orders.

9. We attach for the NCAT's reference our communication with the Respondent's solicitor.

8. Secondly, the supplementary statement of their expert Mr Aaron Kyle. Relevantly Mr Kyle states:

1.1. In accordance with CAT Procedural Direction 3 - Expert Evidence, I hereby provide this Supplementary Report noting a change of my professional opinion on a material matter ("Supplementary Report").

1.2. This document complies with CAT Procedural Direction 3 - Expert Evidence, specifically paragraphs 19 and 22 (the "Code").

1.3. The change of my professional opinion concerns a costing item previously referred to as 'Carpentry listed under 'S 8.3 - Cost to Complete Incomplete Works - Method #1: That is, Item 10.2 - 'Allowance for timber / carpentry consumables.' for the amount of $3,600.00 exclusive of applicable margins and GST as outlined on page 22 of my Expert Witness Report dated 4 October 2022 ("Expert Report").

1.4. Additionally, the change of my professional opinion also applies to the same costing item which was listed and included in a joint report prepared by myself and Steven Nakhla - Expert for the Respondent, dated 7 February 2022 (the "Joint Report").

1.5. Following the NCAT Hearing conducted on 8 February 2023 (the "Hearing"), in which I provided expert evidence on behalf of the Applicant in this matter; I later reflected on the costings that I provided for the above item during the Hearing (*Item 10.2").

1.6. As a result of undertaking my reflection, I subsequently prepared further detailed costing analysis for the primary purpose of conducting a 'health-check' on Item 10.2 ("Further Analysis") which was discussed and cross-examined on during the Hearing.

1.7. For complete clarity and transparency, I have included the Further Analysis information and details as a result of conducting my 'health-check'. This is included as 'Annexure A' attached to this Supplementary Statement ("Annexure A").

1.8. Annexure A includes carpentry consumables and materials for the Carpentry related items forming the Contract Works. As a result of carrying out my Further Analysis, the result is a total amount of $22,828.50 exclusive of GST and applicable margins.

1.9. This amount is higher than the originally provided amount of $3,600.00 allowed for under Item 10.2 in my Expert Report.

1.10. In light of the above cost increase, it is my duty as an independent Expert Witness appearing before CAT, to provide evidence in accordance with the Code. As a result of my change in opinion; I hereby provide written notice of my change of professional opinion for Item 10.2, which is now $22,828.50 exclusive of GST and applicable margins.

1.11. As a consequence of changing my opinion on Item 10.2, my view has changed in respect of incomplete works and I have revised the table as per Annexure B ("Annexure B").

1.12. During the Hearing, I also conceded that the amount of $1,232.00 should be deducted from Item 18.2 - Allowance for other titling related consumables ($2,000.00). This means that the cost for Item 18.2 should now amount to $768.00 This is also reflected in the attached Annexure B for this item ("Item 18.2").

1.13. Finally, as a result of the above changes, the total amount to complete the incomplete works as reflected in Annexure B, is now $319,666.66 inclusive of GST.

Submissions

9. Mr Blackman made oral submissions at the hearing on 13 March 2023.

10. First, he invoked ss 38(2), 38(5)(c) and 38(6)(a) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act). Those sections relevantly provide:

38 Procedure of Tribunal generally

(1) The Tribunal may determine its own procedure in relation to any matter for which this Act or the procedural rules do not otherwise make provision.

(2) The Tribunal is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice.

…

(4) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.

(5) The Tribunal is to take such measures as are reasonably practicable--

(a) to ensure that the parties to the proceedings before it understand the nature of the proceedings, and

(b) if requested to do so--to explain to the parties any aspect of the procedure of the Tribunal, or any decision or ruling made by the Tribunal, that relates to the proceedings, and

(c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings.

(6) The Tribunal--

(a) is to ensure that all relevant material is disclosed to the Tribunal so as to enable it to determine all of the relevant facts in issue in any proceedings, and

(b) may require evidence or argument to be presented orally or in writing, and

(c) in the case of a hearing--may require the presentation of the respective cases of the parties before it to be limited to the periods of time that it determines are reasonably necessary for the fair and adequate presentation of the cases.

(emphasis added)

11. Secondly, he referred to [22] of the Tribunal’s Procedural Direction 3 “Expert Evidence” which states:

If an expert witness changes his or her opinion on a material matter after providing a report, the expert witness must immediately provide a supplementary report to that effect containing any relevant information referred to in paragraph 19.

12. Paragraph [19] states:

An expert’s report must, either in the body of the report or in an annexure, include the following:

(a) an acknowledgement that the expert has read the experts’ code of conduct and agrees to be bound by it;

(b) the expert’s name, address and qualifications as an expert on the issue the subject of the report;

(c) the facts, and assumptions of fact, on which the opinions in the report are based (a letter of instructions may be annexed);

(d) the expert’s reasons for each opinion expressed;

(e) if applicable, that a particular issue falls outside the expert’s field of expertise;

(f) any literature or other materials used in support of the opinions;

(g) any examinations, tests or other investigations on which the expert has relied, including details of the qualifications of the person who carried them out;

(h) in the case of a report that is lengthy or complex, a brief summary of the report (to be located at the beginning of the report).

13. Thirdly, he submitted that:

1. if the Tribunal did not allow the supplementary report to be filed, the applicant would suffer prejudice in that it would be prevented from claiming an additional $22,828.50 in relation to item 10.2;

2. the filing of the supplementary statement would assist the Tribunal.

Respondent’s submissions

14. The respondent opposes the application for the following reasons.

15. First, the respondent emphasises that at the conclusion of the first day of the hearing, the expert evidence was completed, and both experts were released.

16. Secondly, the applicants have not provided any proper explanation as to why the additional evidence of Mr Kyle was not led in his original statement, the only explanation being the undertaking of a “health check”.

17. Thirdly, a costs order is not a salve to the introduction of evidence “after the event”: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175. The respondent submits that this is not an application that can be cured by a “costs thrown away” order, as the applicants have not established that there is proper explanation for why this evidence was not led in Mr Kyle's original statement.

18. Fourthly, this is an application to introduce fresh evidence that appears to have been omitted by inadvertence: EB v CT (No 2) [2008] QSC 306 at [6].

19. Fifthly, the introduction of this evidence will cause prejudice to the respondent because of:

• additional costs, estimated to be between $8,000 to $12,000”;

• the need to re-engage Mr Nakhla, have him review the supplementary statement, prepare a report in response, arrange for the experts to hold a further conclave, have the experts prepare an updated joint Scott Schedule and have both experts re-called to give evidence and be cross examined at the second day of the hearing.

20. Sixthly, the introduction of this evidence is contrary to the guiding principle in s 36 of the NCAT Act.

21. The respondent relies on Smith v New South Wales Bar Association (1992) 176 CLR 256 at [32], Bailey v Palombo [2020] NSWSC 1209 at [28], Reid v Brett [2005] VSC 18 at [41] and Bao Long Guo t/as GD Brother Projects v GB Electrical Services Pty Ltd [2020] NSWCATAP 131 at [55] and [59].

Principles to be applied

22. Of the authorities referred to by the respondent, the following passages are relied on.

23. First, in Smith the High Court the plurality of the High Court stated at [32] (footnotes omitted):

… If an application is made to re-open on the basis that new or additional evidence is available, it will be relevant, at that stage, to enquire why the evidence was not called at the hearing. If there was a deliberate decision not to call it, ordinarily that will tell decisively against the application … But assuming that that hurdle is passed, different considerations may apply depending on whether the case is simply one in which the hearing is complete … or one in which reasons for judgment have been delivered. As, for example … It is difficult to see why, in the former situation, the primary consideration should not be that of embarrassment or prejudice to the other side … In the latter situation the appeal rules relating to fresh evidence may provide a useful guide as to the manner in which the discretion to re-open should be exercised. But those considerations bearing on re-opening are not decisive of the question whether, a matter having been re-opened by reason of error, further evidence can be called.

(emphasis added by the respondent)

24. Secondly, in Bailey v Palombo [2020] NSWSC 1209 the Court stated at [28] (citations omitted, emphasis added by the respondent):

Any decision to grant leave to re-open is one that involves the exercise of discretion, and the question whether the interests of justice are better served by allowing, or rejecting, the application … The circumstances to be considered include: whether there is prejudice to the other party; the reasons why the evidence was not led in the first place; whether there had been a deliberate or tactical decision made not to call the evidence during the hearing; any delay in making the application; and the importance, relevance and probative value of the proposed new evidence to the issues in the case. …

25. Thirdly, in Reid v Brett [2005] VSC 18 the Court stated at [41]:

The criteria governing the exercise of the discretionary power to re-open a case to admit further evidence where the hearing has concluded but judgment has not been delivered have been said to be as follows:

(a)    the further evidence is so material that the interests of justice require its admission;

(b)       the further evidence, if accepted, would most probably affect the result of the case;

(c)        the further evidence could not by reasonable diligence have been discovered earlier;  and

(d)        no prejudice would ensue to the other party by reason of the late admission of the further evidence.

…

26. Fourthly, in Bao Long Guo t/as GD Brother Projects v GB Electrical Services Pty Ltd [2020] NSWCATAP 131 the Appeal Panel stated:

55. There can be no doubt that the evidence which is now sought to be adduced by these affidavits was readily available at the time that the proceedings were dealt with at first instance. The evidence relates to a period prior to the hearing at first instance.

…

59. The expense of litigation and the public interest in the finality of litigation are relevant factors to be weighed in deciding whether to exercise a discretion to accept fresh evidence.

27. Fifthly, in EB v CT (No 2) at [6] the Court stated:

The application to re-open is not to overcome a technical defect in the evidence or to tender evidence that was omitted by inadvertence. The application seeks to raise a new issue, namely the current value of certain assets of one of the parties, whereas the issue litigated at the hearing was the assets, financial resources and liabilities of the parties at the date of the hearing. It is impossible to see how the respondent could be permitted to call evidence of the current value of some of his assets without, in fairness, opening up the general issue of the current value of the parties’ assets. To do otherwise would be to fall into error. It would be wrong to determine the matter on the basis of the current value of some assets and the value as at the date of the hearing of the balance of the assets.

Consideration

28. The various authorities referred to above consider scenarios where the case has concluded and leave to reopen the case proper is sought. That is not the same as the situation before me, although it is analogous. Here the case has not concluded, but a component has, being the completion of the expert evidence.

29. I note at the outset that I see nothing inappropriate about the application, and accept that the applicants were bound to bring Mr Kylie’s change of opinion to the attention of the Tribunal.

30. The relevant principles to be applied in this application may be summarised as follows:

1. the further evidence if accepted would most probably affect the result of the case;

2. the further evidence could not with reasonable diligence have been discovered earlier;

3. no prejudice would ensue to the other party by reason of the later admission of the further evidence;

4. the further evidence must be so material that the interests of justice require its admission.

31. To these factors must be added the guiding principle of the NCAT Act, namely to facilitate the just, quick and cheap resolution of the real issues in the proceeding: s 36.

32. Dealing with each factor in turn, in my view:

1. for reasons that I will make plain later in these reasons, I do not accept that the further evidence sought to be relied on would most probably affect the result of the case. It may, that is to say the respondent’s expert might also retract on his views and agree with Mr Kyle, but then the Tribunal would have to accept the figure. So while I can accept that the further evidence may affect the result of the case, I do not accept that this would probably be the case;

2. whether the further evidence could not with reasonable diligence have been discovered earlier is not a relevant factor in one sense – the expert has simply changed his mind based on the same facts on which he was asked to opine. In another sense, the evidence could have been made available if the expert had exercised his mind more thoroughly prior to giving his opinion. Either way, I do not accept that this factor favours the receipt of the supplementary statement;

3. in my view the supplementary statement will cause prejudice to the respondent, being a delay in the final outcome, the recalling of witnesses, the preparation of a further report in reply., a further conclave and possibly the recalling of the experts. I accept that some of these matters can be cured by a costs order, but not the further delay in the completion of the proceedings;

4. I do not accept that the further evidence is so material that the interests of justice require its admission. As I say, in my view the expert has simply changed his mind.

33. Finally, the guiding principle also militates against the application being granted. “When does it all end?” I ask rhetorically. Mr Kyle gave an independent expert report, participated in a conclave, reduced his opinions to writing in a joint Scot Schedule and then participated in a “hot tub”. After giving evidence to the Tribunal, he then conducts a “health check”, and changes his mind, in circumstances where there is not a jot or tittle of persuasive evidence to explain why. It would be inconsistent with the guiding principle to allow this evidence to be filed now.

34. In my view, the applicants simply wish to update their evidence. That is not a persuasive reason for reopening the expert evidence component of the hearing.

35. The application to file the supplementary statement of Mr Kyle is refused.

Costs

36. The applicant has been unsuccessful. If the respondent seeks costs, it should file submissions within 14 days. Those submissions must identify the relevant costs rule, and the reason why the respondent says it is entitled to costs.

37. The applicant may respond within a further 14 days, and the respondent may reply within a further 7 days.

38. The Tribunal proposes to deal with the question of costs on the papers and without a hearing. If either party opposes that course it may address that matter in their submissions.

39. Any submission is to be no longer than five pages.

Orders

40. The Tribunal orders:

1. The applicant’s application to file the supplementary report of Mr Kyle and for ancillary orders is dismissed.

2. If the respondent seeks costs, it should file submissions within 14 days. Those submissions must identify the relevant costs rule, and the reason why the respondent says it is entitled to costs.

3. The applicant may respond within a further 14 days.

4. The respondent may reply within a further 7 days.

5. The hearing date of 4 April 2023 is confirmed.

**********

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 03 July 2023