Hyperion Property Syndicates Ltd v CBRE Pty Ltd

[2014] NSWSC 1637

Supreme Court

New South Wales

Medium Neutral Citation:	Hyperion Property Syndicates Ltd v CBRE Pty Ltd; In the matter of Accord Pacific Land Limited (in liq) [2014] NSWSC 1637
Hearing dates:	18 November 2014
Decision date:	18 November 2014
Jurisdiction:	Equity Division - Corporations List
Before:	Brereton J
Decision:	Order that evidence of two witnesses at the trial, other than evidence as to specified conversations, must be given by affidavit.
Catchwords:	EVIDENCE - course of evidence and addresses - course of evidence - where proceedings continue on pleadings - prima facie position is evidence must be given orally - where parties have proceeded on basis that evidence would be given by affidavit - where disputed conversations - where defendant seeks that evidence of conversations be given orally PROCEDURE - Supreme Court procedure - New South Wales - proceedings on or continued on pleadings - evidence in chief of witnesses at trial must be given orally unless the Court otherwise orders
Legislation Cited:	(NSW) Civil Procedure Act 2005, s 61, s 62 UCPR r 31.1(2), r 31.1(3), r 31.4
Category:	Interlocutory applications
Parties:	12/325574: Hyperion Property Syndicates Ltd (plaintiff) CBRE Pty Ltd (first defendant) Gavin Lloyd (second defendant) Accord Pacific Properties Pty Ltd (third defendant) Choon Keng Kho (fourth defendant) Chuang Thye Patrick Kho (fifth defendant) 13/132907: Bruce Gleeson (first plaintiff) Accord Pacific land Pty Ltd (in liq) (second plaintiff) Accord Pacific Properties Pty Ltd (first defendant) Accord Pacific Holdings Pty Ltd (second defendant) Steven Damien Timothy Gargano (third defendant) Choon Keng Kho (fourth defendant) Chuan Thye Patrick Kho (fifth defendant) CBRE Pty Ltd (sixth defendant) Gavin Lloyd (seventh defendant) Richard Butler (eighth defendant)
Representation:	Counsel: 12/325574: Mr D R Sulan (plaintiff) Mr D A McLure (first & second defendants) Mr L Gor (third to fifth defendants) 13/132907: Ms S Stojonovski (solicitor) (plaintiffs) Mr L Gor (first to fifth defendants) Mr D A McLure (sixth to eighth defendants) Solicitors: 12/325574: Matthews Folbigg Pty Ltd (plaintiff) Kennedys (first & second defendants) Colin Biggers & Paisley (third to fifth defendants) 13/132907: Gillis Delaney Lawyers (plaintiffs) Colin Biggers & Paisley (first to fifth defendants) Kennedys (sixth to eighth defendants)
File Number(s):	12/325574; 13/132907

Judgment (ex tempore)

1. HIS HONOUR: Before the court is an application for a direction that certain parts of the evidence in chief of two witnesses, namely Ian Greenwood, who is a director of the plaintiff Hyperion, and Gavin Lloyd, who is an employee of the first defendant CBRE, be given orally at the trial. As will become apparent, whether such a direction is necessary is doubtful, but, given the manner in which the cases have so far proceeded, it is appropriate that the position be clarified.

1. In proceedings 2012/325574 Hyperion v CBRE, which, for the sake of convenience, I shall call the Commercial List proceedings, Hyperion commenced proceedings against CBRE and four other defendants in the Commercial List by summons and commercial list statement alleging that CBRE had engaged in misleading and deceptive conduct and that the other defendants were involved in that conduct, by artificially inflating the apparent value of a property which Hyperion purchased from the third defendant Accord Pacific Land Limited, by underpinning that sale with a lease back to Accord at what is alleged to be an inflated rent.

1. Under the Commercial List Practice Note, paragraph 5 of the Usual Order for Hearing provides that where no directions have been given for the service of affidavits or statements of evidence, each party is required, not less than 28 days before the date fixed for hearing, to serve on the other a statement of the evidence proposed to be led from each witness. Where directions have been given for the service of affidavits or statements of evidence, the court may, on such terms as it thinks fit, direct that the statement of evidence served or part of it stand as the evidence in chief of the witness or as part of such evidence.

1. Although the Practice Note is not explicit in this respect, the underlying default position seems to be that in the absence of specific directions, while statements of evidence are to be served before the date fixed for hearing, the evidence in chief is given orally at the hearing, unless the court makes a direction that the statement stand as the evidence in chief.

1. On 14 June 2013 and subsequently, directions were made for the service of the parties' "evidence" but, to adopt Mr Gor's terminology, the directions made on that and on each subsequent occasion limiting the time for service of "evidence" were "agnostic" as to whether that evidence would be by way of witness statement or affidavit. In particular, no specific direction was made for affidavit evidence, or that the hearing be on affidavits.

1. The Commercial List, although it now resides in the Equity Division, had its origins in the Common Law Division and its practices originated in common law practice. Before the emergence of "List Statements", proceedings were typically conducted on pleadings and evidence was given orally. For that, amongst other reasons, witness statements rather than affidavits tend to be the standard means of providing evidence in Commercial List proceedings.

1. Accordingly, it seems to me that the position is that, absent any direction that the evidence be by way of affidavits, the evidence in chief in the Commercial List proceedings would have been given orally, albeit following advance notification by way of witness statements, unless the Court directed that the statement stand as the evidence in chief, which it would not lightly do over objection.

1. On 30 June 2014 the Commercial proceedings were transferred to the Corporations List to be heard with the Corporations proceedings, to which I shall now come. In the Corporations proceedings, the liquidator of Accord, and Accord (as a company in liquidation), sue Accord's directors for breach of their duties as directors in permitting Accord to enter into the lease with Hyperion at an inflated rent, and seek to have that lease avoided as an uncommercial transaction.

1. Those proceedings were commenced, as corporations proceedings must be, by originating process. However, on the first return date, 27 May 2013, the court made an order by consent that the matter proceed on pleadings. The directions also provided for the plaintiffs to file and serve "points of claim", and later directions provided for the defendants to file and serve "points of defence", but that terminology was inapt: when an order is made that proceedings continue on pleadings, the documents to be filed and served are pleadings - a statement of claim and a statement of defence - in conformity with the Rules.

1. In any event, the documents that were filed, albeit entitled "points of claim" and "points of defence", appear to conform with the requirements of a statement of claim and a statement of defence, and it seems to me they should be regarded as a statement of claim and defence respectively in the light of the order that the proceedings continue on pleadings.

1. UCPR r 31.1 applies to a trial of proceedings commenced by statement of claim, or in which a statement of claim has been filed (and thus where an order has been made that the proceedings continue on pleadings), it provides that, subject to certain presently irrelevant exceptions, "a witness's evidence at a trial must be given orally before the court". That rule is subject to the court's extensive discretion, including under (NSW) Civil Procedure Act 2005, s 61 and s 62, to make directions in respect of the proceeding and how the evidence is to be given, and to UCPR r 31.1(3), which provides that the court may order that all or any of the witnesses' evidence at a trial must be given by affidavit or, subject to r 31.4, by witness statement.

1. Directions have been made from time to time in the Corporations proceedings, again in terms that the parties serve their "evidence" by limited dates, and again those directions have been agnostic as to whether what is to be served is to be affidavits or witness statements. No order has been made that all or any of a witness's evidence at the trial must be given by affidavit or by witness statement.

1. In those circumstances it seems to me that the present position is that, in conformity with r 31.1(2), the evidence in chief at the trial must be given orally or the evidence in chief at the trial must be given orally before the court.

1. That said, the parties have apparently proceeded to date on the basis that the evidence would be given by affidavit and the "evidence" that has been served, pursuant to the directions made in both matters, has been in affidavit form. It seems to me that the position has been reached, effectively by some convention between the parties, that affidavit evidence may be adduced, notwithstanding the requirements of r 31.1. As that course is likely to save time at the trial, as well as serving the function of notifying each party of the evidence that the other party proposes to adduce, the court would not stand in the way of the parties proceeding on that basis, to the extent that they desire to do so.

1. Accordingly, it seems to me the parties effectively now consent to an order that, except in certain limited respects, the witnesses' evidence must be given by affidavit. The exception extends at least to the evidence covered by directions sought by the defendants in the Commercial proceedings: being certain conversations to which Mr Greenwood deposes and which Mr Lloyd in part disputes, in which representations on which Hyperion relies were allegedly made.

1. While the dispute in respect of those conversations seems a relatively narrow one, and the importance that attends it is not sought to be overstated, it seems to me that as the default position is that in proceedings on pleadings, the evidence is to be given orally, then a party is entitled, if it so wishes, to have that evidence given orally, unless some sufficient reason to depart from that position appears. The mere fact that the parties have served affidavits covering that evidence is not sufficient: in fact it will often be the emergence of competing versions that makes it desirable that its evidence be adduced orally.

1. Although the application is made by the defendant for a direction that the plaintiffs' relevant evidence be given orally, the defendant acknowledges that the same should apply to the opposing evidence that it wishes to adduce. Indeed, it seems to me that the court is more likely to benefit from Mr Lloyd's evidence being given orally, as he will then be required to give his version of the relevant conversations in full, rather than simply by denying some aspects of Mr Greenwood's version, as his affidavit evidence does.

1. The court orders that:

(1) Pursuant to UCPR r 31.1(3) the evidence of Ian Greenwood at the trial, other than his evidence of the conversations referred to in paragraphs 14, 19, 21, 23 and 24, of his affidavit sworn 16 July 2013, must be given by affidavit;

(2)   The evidence of Gavin Lloyd at the trial, other than his evidence of the said conversations, must be given by affidavit;

(3)   The proceedings be adjourned to 9 February 2015 at 10am in the Corporation Judge's directions list, on which occasion (if consent orders disposing of the issue have not by then been made), I would propose to make an order that the evidence of all other witnesses at the trial must be given by affidavit, subject to such exceptions as may be determined on that occasion.

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Decision last updated: 19 November 2014