Matthews v SPI Electricity (Ruling No 19)
[2013] VSC 180
•18 April 2013
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
COMMON LAW DIVISION
No. 4788 of 2009
| CAROL ANN MATTHEWS | Plaintiff |
| v | |
| SPI ELECTRICITY PTY LTD (ACN 064 651 118) AND ORS | Defendants |
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JUDGE: | J FORREST J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 9 April 2013 | |
DATE OF RULING: | 18 April 2013 | |
CASE MAY BE CITED AS: | Matthews v SPI Electricity & Ors (Ruling No 19) | |
MEDIUM NEUTRAL CITATION: | [2013] VSC 180 | |
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PRACTICE AND PROCEDURE – Whether the Court should be assisted by an assessor or special referee – Reference by the Court to a special referee – Reference opposed – Function of assessor – Appointment of assessor - Supreme Court Act 1986 (Vic), ss 25, 77.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr R Richter QC with Mr T Tobin SC Mr A J Keogh SC Mr L W L Armstrong & Ms M Szydzik | Maurice Blackburn |
| For the First Defendant | Mr J Beach QC with Mr P H Solomon SC Mr B Quinn SC Mr D Farrands Mr C Parkinson & Mr J Kirkwood | Herbert Freehills Smith |
| For the Second Defendant | Mr R Ray QC with Ms E Brimer | Holman Fenwick Willan |
| For the Third, Fourth and Fifth Defendants | Mr C M Caleo SC with Mr P E Anastassiou SC Ms W A Harris SC Mr S A O’Meara SC Mr P Zappia Ms A L Robertson Dr M D Rush Mr N McAteer & Mr A D Pound | Norton Rose |
HIS HONOUR:
Introduction
The question of the cause or causes of the failure of the conductor on the Valley Span is of critical importance in determining the legal liability of SPI to Mrs Matthews and the group members. There are many complex scientific and engineering issues that must be understood for a just determination of this question.
Prior to the trial commencing I raised with the parties whether it was possible to determine this question without the assistance of a suitably qualified person with appropriate engineering and/or physics qualifications. The parties arranged for two experts, metallurgists Dr Barter and Professor Gates, to give the Court a briefing as to the fundamental concepts involved in ascertaining the cause of the failure of the conductor. Counsel also assisted me with their own assessment of the issues I would have to tackle. The point has now come to a head and I need to determine how to proceed when the expert evidence is called as part of concurrent evidence sessions in late 2013.
Mrs Matthews says that I should determine the technical issues on my own. Should I decide otherwise, she says I should sit with an assessor as opposed to engaging a special referee. SPI and USC, on the other hand, have astutely perceived my limitations and say that I should sit with an assessor. They are joined in this submission by the State parties. All parties oppose a reference to a special referee.
The scientific / engineering issues
The parties have outlined the principal scientific/engineering questions relevant to the fracture of the conductor as follows:
Principal issues:
1. Why did the Valley Span conductor fail on 7 February 2009?
2.What was the role of the quench cracks at the base of the depressions in Strands 3 and 2 in the failure of the conductor?
3.On the balance of probabilities, was Aeolian vibration a cause the failure of the Valley Span conductor on 7 February 2009?
4.On the balance of probabilities, would the installation of spiral vibration dampers have prevented the failure of the Valley Span conductor on 7 February 2009?
Sub-issues:
(a)What magnitude and number of stress cycles was required to (i) initiate, and (ii) propagate, fatigue cracks from the quench cracks in Strands 3 and 2?
(b)What magnitude and number of stress cycles would have been produced in the conductor by Aeolian vibration?
(c)What magnitude and number of stress cycles would have been produced in the conductor by other (non-Aeolian) forms of vibration or load events?
(d)What would have been the effect of a spiral vibration damper on the failure of the conductor? Prevention? Delay? No difference?
(e)What was the relative timing and mode of failure of each of Strands 3, 2 and 1?
(f)What is the relevance of the 45 degree fracture plane observed on strands 3 and 2 to the mode of failure?
The issues covered by the expert evidence conclaves
The expert evidence in this trial will be given concurrently. The issues for the experts have been divided into eleven topics. The experts have already provided individual reports, met in conclaves to discuss the relevant issues, provided joint reports and, in some cases, provided individual supplementary reports.
Three conclaves have already considered issues relevant to the cause of the failure:
· The first conclave considered the failure of the conductor.
· The third conclave considered “quantitative analysis” of loads or stresses on the conductor.
· The fourth conclave considered “qualitative analysis” of loads or stresses on the conductor.
The issues considered by Conclave 1 in relation to conductor failure included:
(a)fracture features at the pole 39 end of the conductor;
(b)availability and utility/effect of preventative measures;
(c)experiments by Dr Barter;
(d)arc marks/discontinuities at the pole 38 end of the conductor;
(e)the timing and effect of the dislocation of the helical termination;
(f)identification of fracture types; and
(g)sequence of fracture failures.
The issues considered by Conclave 3 in relation to the quantitative impact of loads and stresses on what were described as primary fractures included:
(a)methods, assumptions and conclusions from each expert’s tests/models;
(b)loads and stresses affecting the conductor near pole 39;
(c)effect of particular loads/stresses on fractures, including:
(i)the effect of martensite/pre-cracks on fractures;
(ii)the effect of misalignment of the helical termination;
(iii) the effect of vibration on conductor; and
(iv)the effect of vibration damping or other measures on the probability and timing of the fractures.
The issues considered by Conclave 4 in relation to the qualitative analysis of loads and stresses on the conductor included:
(a)qualitative analysis of loads or stresses;
(b)wind induced vibration; and
(c)the effect of wind-induced vibration on conductor failures;
(d) the effect of other relevant loads, stresses or factors on conductor failures; and
(e) the effect of vibration damping on risk of conductor failures.
The CPA
Chapter 2 of the Civil Procedure Act2010 (Vic)[1] sets out the overarching purpose of that Act and the rules of the Court:
[1](“CPA”).
7 Overarching purpose
(1) The overarching purpose of this Act and the rules of court in relation to civil proceedings is to facilitate the just, efficient, timely and cost effective resolution of the real issues in dispute.
9 Court's powers to further the overarching purpose
(1) In making any order or giving any direction in a civil proceeding, a court shall further the overarching purpose by having regard to the following objects—
(a)the just determination of the civil proceeding;
…
(c)the efficient conduct of the business of the court;
(d)the efficient use of judicial and administrative resources;
…
(g)dealing with a civil proceeding in a manner proportionate to—
(i) the complexity or importance of the issues in dispute; and
(ii) the amount in dispute.
(2) For the purposes of subsection (1), the court may have regard to the following matters—
…
…
(g)the public importance of the issues in dispute and the desirability of a judicial determination of those issues;
…
(3) This section does not—
(a) limit any other power of a court to make orders or give directions; or
(b) preclude the court from considering any other matters when making any order or giving any direction.
Then there is Part 4.6 which came into operation in December 2012 and applies to this proceeding:[2]
[2]See Civil Procedure Amendment Act2012 (Vic) no 62 of 2012.
65M Court appointed experts
(1) A court may make an order appointing an expert—
(a) to assist the court; and
(b) to inquire into and report on any issue in a proceeding.
(2) The court may make an order appointing a court appointed expert at any stage of the proceeding.
(3) In making an order to appoint a court appointed expert, the court must consider—
(a) whether the appointment of a court appointed expert would be disproportionate to—
(i) the complexity or importance of the issues in dispute; and
(ii) the amount in dispute in the proceeding;
(b) whether the issue falls within a substantially established area of knowledge;
(c) whether it is necessary for the court to have a range of expert opinion;
(d) the likelihood of the appointment expediting or delaying the trial;
(e) any other relevant consideration.
(4) A person must not be appointed as a court appointed expert unless he or she consents to the appointment.
Judicial determination without assistance of a special referee or an assessor
Mrs Matthews is confident that I have the ability to determine the issues myself and therefore do not need the assistance of an assessor.
Mrs Matthews says the assistance I will get from the experts will enable me to understand the scientific / engineering concepts.
I do not doubt that the experts will provide me with ample explanation. However, I am not confident that I will understand it. True it is that I will have the opportunity to question each of the experts on points of difficulty. But even then, especially where there is disagreement, I may not be able to resolve those questions without some assistance.
If I decide to determine this matter without assistance, I am quite unsure as to whether I can give effect to the overarching purpose of endeavouring to resolve a civil dispute (whether by reference to s 7 of the CPA or to the common law) – to provide the parties with a just result or, to use the language of s 9(1)(a) of the CPA, to reach a “just determination” of the proceeding. As I mentioned earlier, I have been assisted by the presentation of two highly qualified experts.[3] Those presentations left me with a greater understanding of the issues that I have to determine. But they also gave me an insight as to the problems I would face in endeavouring to resolve technical disputes in this matter without assistance.
[3]Presentations by Dr Barter, Professor Gates, counsel for Mrs Matthews and SPI on 25 February 2013.
I have reflected long and hard about whether I should seek assistance either in the form of a special referee or an assessor. I think it clear from both the CPA, the Supreme Court Act 1986 (Vic)[4] and the Supreme Court (General Civil Procedure) Rules 2005[5](to which I will turn in a moment) that where judicial officer doubts his or her own ability to deal with a complex matter outside his or her experience or knowledge then there is a way in which the exercise can be made easier and, more importantly, fairer.
[4](“SCA”).
[5](“SCR”).
Having paid close attention to both the submissions of counsel and the expert presentation, I am firmly of the view that reaching a just result demands that I obtain assistance. This would either be in the form of a referral to a special referee or, alternatively, hearing the evidence myself with an assessor sitting in court. I now turn to these two alternatives.
Referral to a special referee
Rule 50 of the Supreme Court (General Civil Procedure) Rules 2005 reads as follows:
50.01 Reference to special referee
(1) In any proceeding the Court may, subject to any right to a trial with a jury, refer any question to a special referee for the referee to—
(a) decide the question; or
(b) give the referee's opinion with respect to it.
(2) Where an order is made under paragraph (1), the Court—
(a) shall state the question referred;
(b) shall direct that the special referee make a report in writing to the Court on the question referred to the referee stating, with reasons, the referee's decision or opinion;
(c) may direct that the special referee give such further information in the referee's report as it thinks fit.
(3) The Court may upon application by a party or by the special referee set aside or vary an order made under this Rule.
50.02 Directions as to procedure
Where an order is made under Rule 50.01, the Court may give directions for the conduct of the reference, and in particular may direct that—
(a) the special referee have the same authority with respect to discovery of documents and interrogatories as the Court;
(b) evidence be taken by the referee and the attendance of witnesses and the production of documents be compelled by subpoena.
50.03 Report on reference
(1) The special referee may in the referee's report—
(a) submit any question arising on the reference for the decision of the Court; or
(b) make a statement of facts found by the referee from which the Court may draw such inferences as it thinks fit.
(2) On the receipt of the special referee's report, the Court—
(a) shall give notice thereof to the parties; and
(b) may by order—
(i) require the special referee to provide a further report explaining any matter mentioned or not mentioned in the report;
(ii) remit the whole or any part of the question originally referred to the special referee for further consideration by that referee or any other special referee;
(iii) vary the report.
(3) An application by a party for an order under paragraph (2)(b) shall be made on not less than three days' notice to the other party or parties.
50.04 Use of report
The Court may as the interests of justice require adopt the report of a special referee or decline to adopt the report in whole or in part, and make such order or give such judgement as it thinks fit.
In AT and NR Taylor & Sons Pty Ltd v Brival Pty Ltd,[6] Beach J held that where a party does not consent, only cases of an “exceptional nature” should have a special referee:
Where a party to litigation wishes the sort of dispute which normally calls for judicial determination to be tried by a judicial tribunal it will only be in cases of an exceptional nature that his wishes will be disregarded and the matter referred to an arbitrator or special referee. In my opinion, the so-called complexities of the matters pointed to by the plaintiff in support of its application do not constitute special circumstances in the present case.[7]
[6][1982] VR 762.
[7]Ibid 765.
Times have changed, particularly with the introduction of the CPA. The Court is now obliged to consider far more than a party’s tactical or forensic position. In Talacko v Talacko,[8] determined prior to the introduction of the CPA, Kyrou J held that a special referee can be appointed where a party opposes it. In that case, the special referee was required to assist the Court in assessing properties located in the Czech Republic, Slovakia, and Germany. His Honour said as follows:
Although the absence of consent by a party and the reasons given for withholding consent are clearly relevant to the exercise of the court’s power under O 50 of the Rules to appoint a special referee, I am not persuaded that the power to appoint a special referee over the objection of a party can only be exercised in special circumstances as suggested by AT & NR Taylor & Sons Pty Ltd v Brival Pty Ltd and Abigroup Contractors Pty Ltd v BPB Pty Ltd. O 50 does not contain such a requirement and one should not be read into it, so that the discretion conferred by the Rules is not unduly constrained. However, if special circumstances are required, the factors I referred to in paragraph 25 of these Reasons are, taken together, special circumstances. They warrant the appointment of a special referee over the objection of the defendant.[9]
[8][2009] VSC 98.
[9]Ibid [27].
All of the parties are against the referral of questions to a special referee. This opposition alone would not, consistent with the provisions of the CPA and order 50 of the SCR, preclude a court from taking that step. Nothing in s 65M of the CPA requires that a party demonstrate special circumstances for the appointment of a special referee. Nor does Order 50, as Kyrou J has explained.
However there are a number of considerations which persuade me that it is inappropriate to refer out this issue and associated questions to a special referee.
First, the cause of the failure is a critical issue in the case. It is to be contrasted to, say, a referral to a special referee to determine a question of quantum or a side issue. The cause of the failure and the role played by Aeolian vibration is central to SPI’s putative liability. In a case in which so much turns upon a resolution of this issue, I think I should be wary of abdicating responsibility for the determination unless absolutely persuaded as to the necessity of that course. Given, as I shall discuss in a moment, that I have the alternative course of seeking the assistance of an assessor or assessors, I think that referral to a special referee on this matter is less desirable.
Second, it is likely that there will be issues of reliability and credit of one, if not more, of the expert witnesses. This would then be a factor that a special referee may have to consider in making a determination. Gauging and determining the effect of such an attack and the application of Part 3.7 of the Evidence Act 2008 (Vic) in an expert witness session can be difficult for a judge, let alone a legally unqualified expert, no matter how experienced. Moreover, such attacks may require assessment of evidence given in the trial and outside the expert evidence session.
Third, the questions will not be solely scientific but will consist of a hybrid of legal and factual issues. For a special referee determining the issue, he or she would need to understand the factual scenario and, to an extent, the legal concepts of breach and causation. These concepts can of course be addressed by way of the questions posed to the referee but it still leaves a potential problem with the adoption of the report to which I will return in a moment.
Fourth, a referral to a special referee would have a negative impact in terms of timing and subsequent fragmentation of the entire trial. At this point in time, the expert evidence will be heard between October and December this year. In the instance of a referral to a special referee, the Court and the parties will need to wait until a special referee provides findings which then, in turn, would need to be considered by the Court. It is not in the interests of justice to allow the determination of these proceedings to be further delayed.
Finally, there is the question of adoption of the report. In VUT v Wilson & Ors,[10] Harper J noted some of the problems associated with adoption of a special referees’ report:
The relevant authorities, which have considerably increased in number since the lament of Brooking J in Nichols v Stamer, are as one in stressing that, in exercising the responsibilities vested in him or her, the special referee is not conducting a mere prelude to further litigation. Although the courts have declined to catalogue the grounds upon which they may refuse to adopt a special referee’s report, their discretion to adopt or reject it, in whole or in part, is confined only by the interests of justice. This will depend upon the particular circumstances attending particular cases. While r.50.04 includes no guidance to those who must exercise the discretion that it confers upon them, no judicial discretion may be exercised wilfully. This means that, in deciding whether or not to adopt or decline to adopt the report of a special referee, the court must exercise its discretion “in a manner consistent with the object and purpose of the rules and the place they play in the administration of justice according to law.” If the dissatisfied party has identified an error in the law, then because there can be no implied authority to make such errors, the report may be set aside or remitted. A like result would normally - if not inevitably - follow if the referee has acted perversely or unreasonably (as he or she would if his or her decision was against the weight of the evidence). But a court cannot interfere simply because a number of alternative factual findings are open, and the special referee has chosen one or more of them rather than another or others.[11]
[10][2006] VSC 186.
[11]Ibid [26].
There is no certainty that I will be able to understand the calculations or reasoning underpinning any findings made by the special referee. There is also the issue of any attacks by the parties on the findings of the special referee and its adoption. If I am persuaded not to adopt the report, I would essentially be on my own once again - an unpalatable thought.
So, my conclusion is that I should not make a referral out to a special referee.
Appointment of an assessor
Section 65M(1)(a) of the CPA, set out at [11], enables a court to appoint an expert to assist it in reaching a just determination and satisfy its overarching obligations under s 9 of the Act. In addition, the SCA provides for the appointment of an assessor to assist the Court.
77 Assessors
(1) The Court may in any proceeding call in the assistance of one or more specially qualified assessors and hear the proceeding wholly or partially with their assistance but shall not be bound by their opinion or findings.
(2) The Court may determine the remuneration of the assessors.
I could not locate a decision of this Court on the use of s 77 of the SCA. There is, however, guidance from another jurisdiction providing for the appointment of assessors. Section 217 of the Patents Act 1990 (Cth) enables the Federal Court to “call in the aid of an assessor in the hearing and trial or determination” of a proceeding. In Genetic Institute Inc v Kirin-Amgen Inc (No 2),[12] Heerey J decided to sit with an assessor in a patents infringement hearing concerning scientific areas including the glycol protein in red blood cells, the nature of proteins, gene expression, messenger RNA technology, molecular cloning, DNA cloning and screening techniques. His Honour described the role of the assessor prescribed by s 217 as follows:
An assessor is appointed to assist the judge, both in hearing and trial and/or in determination of any proceeding. The judgment in the case, the exercise of the judicial power, remains that of the judge. In exercising judicial power, a judge is routinely assisted by persons who are not judges: counsel, solicitors, witnesses, the judge's associate and secretary and other Court staff.[13]
[12](1997) 78 FCR 368.
[13]Ibid 371.
Heerey J also recognised the added difficulty that arises when the scientific issues are in dispute:
It can be said of many disciplines that the basic concepts can be readily explained to intelligent lay people, including schoolchildren, but that does not prevent the disputes arising between experts, who can contest issues with the enormous advantage of a lifetime of experience in the discipline. The resolution of such disputes by a non-expert judge is likely to be aided by expert assistance such as that provided by an assessor. No doubt the judge could reach a decision without such assistance, but that is not the point; s 217 does not posit a criterion of total judicial inadequacy as a pre-condition of appointment of an assessor. It is simply a question whether the judicial task can be better performed.[14]
[14]Ibid 373.
In F Hoffman-La Roche AG v New England Biolabs Inc,[15] Emmett J also considered the appointment of an assessor under s 217 of the Patents Act 1990 (Cth). His Honour described the role of an assessor in the following terms:
An assessor for that purpose would not necessarily require the qualifications or standing that may be desirable for an expert witness who is to give evidence in the proceedings. An apt description of an assessor might be that he or she is a "human primer" whose function is to assist the court in understanding the complex scientific material that is likely to be before the court in connection with the hearing.[16]
[15](1999) 47 IPR 105.
[16]Ibid [8].
The appointment of an assessor will enable me to seek advice and guidance on scientific and engineering points which are beyond my ken, notwithstanding the assistance of the experts and the parties. I do not have Heerey J’s confidence that I could reach a decision without such assistance but I am sure of one thing – the judicial task can be better performed with such assistance and the likelihood of a fair determination enhanced.
I anticipate that I will need that assistance both before and during the expert witness concurrent evidence sessions as well as subsequently when reviewing the evidence given. I apprehend no restriction imposed by either s 65M of the CPA “to assist the Court” or s 77 of the SCA to “hear the proceeding...with their assistance” in the scope of the assistance provided by an assessor. However, it must be borne firmly in mind that the decision and the exercise of the judicial power is that of the judge and the judge alone.
Accordingly, I propose to sit and hear the evidence relevant to the topics addressed by conclaves 1, 3, and 4 with the assistance of an assessor, or perhaps two assessors.
It is my intention to request Zammit AsJ (who has managed conclaves 1, 3, and 4) to initially consult with Dr Barter and Professor Gates and a nominee of USC to endeavour to identify a suitable person or persons. If that proves too difficult then I shall ask all members of conclaves 1, 3 and 4 to nominate suitable candidates. I will discuss the process further with the parties.
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