Matthews v SPI Electricity (Ruling No 38)
[2014] VSC 102
•21 March 2014
| 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: | 5 & 6 March 2014 | |
DATE OF RULING: | 21 March 2014 | |
CASE MAY BE CITED AS: | Matthews v SPI Electricity & Ors (Ruling No 38) | |
MEDIUM NEUTRAL CITATION: | [2014] VSC 102 | |
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EVIDENCE – Expert opinion based on specialised knowledge – Differentiation of primary and secondary facts – Expert as advocate – Admissibility – “Basis rule” – Necessary to distinguish fact and opinion – Evidence Act 2008 (Vic) s 79 – Civil Procedure Act 2010 (Vic) - Supreme Court (General Civil Procedure) Rules 2005 (Vic).
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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 BR Beach QC with Mr P H Solomon SC Mr B F Quinn SC Mr D J Farrands Mr C O Parkinson Mr J H Kirkwood & Mr L Stanistreet | Herbert Smith Freehills |
| For the Second Defendant | Mr R Ray QC with Ms E M Brimer | Holman Fenwick Willan |
| For the Third, Fourth and Fifth Defendants | Mr C M Caleo SC with | Norton Rose Fulbright Australia |
HIS HONOUR:
Introduction
Dr Nick Hastings, an engineer engaged by Mrs Matthews, has at the request of her solicitors prepared two reports on asset management. He has also prepared a joint report on the same subject with Mr Alexander Dunn, an engineer engaged by SPI.[1] Dr Hastings is due to give evidence next month.
[1]SPI is no longer calling Mr Dunn and does not rely on his reports.
SPI argues that significant portions of Dr Hastings’ two reports are inadmissible on the following grounds:
(a) in many parts of the reports, Dr Hastings has made findings of fact (rather than relying on assumptions of fact and limiting himself to giving expert opinion) and has therefore ventured outside of his role as an expert. One aspect of this is his alleged failure to distinguish between “primary” and “secondary” findings of fact;[2]
(b) to the extent that Dr Hastings’ reports contain opinion evidence, the reports contain a melange of assumptions of fact and expressions of opinion. Because Dr Hastings has failed to distinguish between assumptions of fact and opinion, it is impossible to determine where the application of expertise exists;[3]
(c) to the extent that Dr Hastings’ reports contain opinion evidence, he has failed to adequately substantiate them or adequately link them to his expertise; and
(d) Dr Hastings should be characterised as an advocate for Mrs Matthews, giving unsubstantiated opinions and reaching findings of fact that benefit Mrs Matthews’ case.
[2]This argument was the focus of SPI’s written submissions.
[3]SPI’s oral submissions placed considerable emphasis on this point.
Many of these complaints (particularly that relating to “primary” and “secondary” findings) result from an exhaustive, and exhausting, over-analysis of the contents of the two reports by SPI’s lawyers. Although it is necessary to consider each of SPI’s complaints, I consider that the primary issue is whether Dr Hastings has sufficiently delineated his assumptions of fact from his expressions of opinion.[4]
[4]SPI produced a table (no doubt painstakingly prepared) that identified the specific lines of the two reports which it said were guilty of this failing.
In the result, as I explain, I have decided that Dr Hastings’ reports are admissible in full. Whilst I accept that the reports are not ideally structured so that the differentiation between assumed fact and opinion requires some thought, having read the reports (and the references to many of the documents upon which Dr Hastings relies), I am satisfied that the distinction can be made. I am also satisfied that Dr Hastings’ opinions are referrable to his expertise and sufficiently substantiated. To the extent that SPI is not satisfied as to the accuracy of the assumptions of fact, counsel will be able to challenge these during cross-examination.
Before continuing, I should explain why these objections have been raised now rather than at an earlier stage of the trial. Prior to the trial commencing, I asked the parties to identify any objections to the expertise of a witness. Perhaps over-optimistically, I reasoned that I would have a better understanding of the arguments once the factual evidence had been marshalled and so determined that I would deal with any objections to expert evidence shortly prior to the relevant concurrent evidence session.
Principles
The adducing of expert evidence is regulated by the Evidence Act 2008 (Vic).[5] The Civil Procedure Act 2010 (Vic)[6] and the Supreme Court (General Civil Procedure) Rules 2005 (Vic)[7] also govern procedural aspects of expert evidence, although it is unnecessary to refer to the relevant provisions of these for the purpose of this Ruling.[8]
[5]“Evidence Act”.
[6]“CPA”.
[7]“Supreme Court Rules”.
[8]I referred to the relevant parts in Matthews v SPI Electricity & Ors (Ruling No 36) [2014] VSC 82, 7-8.
Section 76 of the Evidence Act provides that:
Evidence of an opinion is not admissible to prove the existence of a fact about the existence of which the opinion was expressed.
However, s 79 (1) of that Act then provides an exception in relation to expert evidence:
If a person has specialised knowledge based on the person’s training, study or experience, the opinion rule does not apply to evidence of an opinion of that person that is wholly or substantially based on that knowledge.
Although many authorities concerning the adducing of expert evidence were referred to in the course of argument, it is not necessary to go beyond the High Court decision in Dasreef Pty Limited v Hawchar[9] which dealt with opinion evidence and s 79(1) of the Evidence Act 1995 (NSW).[10] In Dasreef, the majority said:
In considering the operation of s 79(1) it is thus necessary to identify why the evidence is relevant: why it is “evidence, that if accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding”. That requires identification of the fact in issue that the party tendering the evidence asserts the opinion proves or assists in proving.
To be admissible under s 79(1) the evidence that is tendered must satisfy two criteria. The first is that the witness who gives the evidence “has specialised knowledge based on the person’s training, study or experience”; the second is that the opinion expressed in evidence by the witness “is wholly or substantially based on that knowledge”.[11] (emphasis added)
and:
It should be unnecessary, but it is nonetheless important, to emphasise that what was said by Gleeson CJ in HG (and later by Heydon JA in the Court of Appeal in Makita (Australia) Pty Ltd v Sprowles) is to be read with one basic proposition at the forefront of consideration. The admissibility of opinion evidence is to be determined by application of the requirements of the Evidence Act rather than by any attempt to parse and analyse particular statements in decided cases divorced from the context in which those statements were made. Accepting that to be so, it remains useful to record that it is ordinarily the case, as Heydon JA said in Makita, that "the expert's evidence must explain how the field of 'specialised knowledge' in which the witness is expert by reason of 'training, study or experience', and on which the opinion is 'wholly or substantially based', applies to the facts assumed or observed so as to produce the opinion propounded". The way in which s 79(1) is drafted necessarily makes the description of these requirements very long. But that is not to say that the requirements cannot be met in many, perhaps most, cases very quickly and easily. That a specialist medical practitioner expressing a diagnostic opinion in his or her relevant field of specialisation is applying "specialised knowledge" based on his or her "training, study or experience", being an opinion "wholly or substantially based" on that "specialised knowledge", will require little explicit articulation or amplification once the witness has described his or her qualifications and experience, and has identified the subject matter about which the opinion is proffered.[12] (emphasis added)
[9](2011) 243 CLR 588 (“Dasreef”).
[10]Section 79 of the Evidence Act (Vic) is identical to the New South Wales provision.
[11](2011) 243 CLR 588, 602-3 (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ).
[12]Ibid 604.
Dr Hastings’ expertise and reports
Expertise
Dr Hastings’ qualifications and expertise are set out in his CV attached to his first report.[13] He holds bachelor and masters degrees in mechanical engineering and a doctorate in operational research. He is a member of the Maintenance Engineering Society of Australia and of the Institute for Asset Management (UK). Since 2001 he has consulted in engineering asset management. He has prepared and delivered training in engineering asset management and Reliability Centered Maintenance (and related techniques), including to those working in the electricity industry. From 2007-2009, he worked as a part time Adjunct Professor at the Cooperative Research Centre for Integrated Engineering Asset Management at the Queensland University of Technology.[14] Between 1966 and 2001, he worked in a range of engineering industry roles including, from 1994-2001, as Professor of Maintenance Engineering at QUT.
[13]EXP.CAM.011.0001, 0050.
[14]“QUT”.
I am satisfied that Dr Hastings has sufficient specialised knowledge, based on his studies and experience, to express an opinion in relation to asset management and its application to issues surrounding the management of the Pentadeen Spur and, in particular, the Valley Span.
Reports
Dr Hastings prepared two reports dated 27 August 2012[15] and 24 September 2012.[16]
[15]EXP.CAM.011.0001.
[16]EXP.CAM.012.0001.
The questions asked of Dr Hastings by Mrs Matthews’ solicitors for the purpose of his first report were:
1. Describe the principal management system approaches for managing fleets of assets such as an electrical distribution network.
2. What is your opinion as to whether SPI’s asset management systems, over such period as is relevant to the condition of its SWER network by February 2009, were in accordance with appropriate asset management practices over the same period?
3. If in your opinion there were aspects of SPI’s systems that were not in accordance with appropriate asset management practices, please explain what, if any, consequences the departure(s) from appropriate asset management practices had, or were likely to have had, for the safety and reliability of the Valley Span by February 2009?[17]
[17]EXP.CAM.011.0001, 0039. For question one and two, Dr Hastings was requested to give particular consideration to a number of listed topics.
Dr Hastings’ first report is 38 pages (plus appendices). It commences with a brief outline of its structure, followed by a summary of conclusions in which Dr Hastings outlines his opinion concerning the maintenance policy of the Valley Span.[18] It then provides an introduction to the terms and techniques used (Section 3) and an overview of SPI’s Valley Span and Conductor Management Policy (Section 4). What follows is a detailed consideration of various asset management topics, as follows:
[18]EXP.CAM.011.0001, 0004-5.
(a) SPI’s asset management policies, both as applicable to the Valley Span and applicable to conductors generally (Section 4);
(b) SPI’s policies and practices for data collection and analysis (Section 5);
(c) asset life spans (Section 6);
(d) identification of risk of asset deterioration or failure (Section 7);
(e) asset inspection frequency and procedures (Section 8);
(f) in-service asset maintenance (Section 9);
(g) repair or replacement of assets – on either a preventative or predictive basis (Section 10);
(h) redesign or modification of assets to avoid in-service failures (Section 11);
(i) the fitting of vibration dampers (Section 12); and
(j) management of protection devices such as Oil Circuit Reclosers (Section 13).
Section 14 then addresses other matters that Dr Hastings considered relevant.[19] In Section 15, he sets out his summary of observations. Section 16 contains several appendices.
[19]In which he notes that he has had very limited opportunity to examine data records and would like a further opportunity to do so.
Each of the main analytical sections (Sections 5-13, inclusive) are structured in the same general way: commencing with a description of “appropriate practice”, followed by a description of SPI’s practices as at February 2009, and concluding with a discussion of the safety and reliability “consequences” of the identified practices for the Valley Span.
Dr Hastings’ second report is 17 pages (plus appendices) and was prepared after he was given the opportunity to examine SPI’s Q4 and PowerOn databases. As with the first report, it begins by briefly outlining its structure, followed by a summary of conclusions[20] concerning conductor maintenance policy and practices relevant to issues in this case.
[20]EXP.CAM.012.0001, 0004-5.
After setting out an outline of the report and a summary of conclusions, Dr Hastings’ second report addresses the following topics:
(a) “background”, including SPI’s conductor maintenance strategy for conductors and the failure of conductors by corrosion, erosion and fatigue (Section 3);
(b) conductor maintenance policy (Section 4);
(c) vibration dampers (Section 5);
(d) limitations of the SPI data system (Section 6); and
(e) Dr Hastings’ views as to what an appropriate conductor maintenance policy would look like, based on a Reliability Centred Maintenance analysis (Section 7).
In each section, as in the first report, Dr Hastings references numerous extracts from SPI documents and statements as to the state and/or quality of SPI’s practices. Sections 8-13 contain a range of appendices.
SPI’s objections to Dr Hastings’ two reports were first raised in a letter from HSF to Maurice Blackburn dated 12 November 2012.[21] This letter focussed on Dr Hastings’ alleged failure to distinguish between “primary” facts and “secondary” propositions.
[21]CRT.SPN.201.0019.
The parties’ submissions
SPI’s submissions
I have set out the gist of SPI’s criticisms at [2], above. I set these out now in a little more detail.
First, SPI says that Dr Hastings has purported to:
(a) make findings of fact (“primary facts”) as to SP AusNet’s data, practices and procedures, based on discovered documents; and
(b) draw further factual conclusions (“secondary facts”) about SP AusNet’s maintenance systems and policies based on those primary facts.[22]
SPI says that neither the primary findings of fact nor secondary propositions can be characterised as expert opinion as they do not derive from or rely upon Dr Hastings’ expertise. It says they are statements of fact masquerading as expert evidence and are matters that the Court could – and indeed should – determine itself.
[22]SPI’s written submissions, dated 7 February 2014, [8]: CRT.SPN.201.0004.
In support of the proposition that Dr Hastings has made impermissible factual findings, SPI points to the letters of instruction from Maurice Blackburn to Dr Hastings, saying that Dr Hastings was not provided with assumed facts or limitations but was simply asked to answer open-ended questions. SPI says that this “supports an inference … that [Dr Hastings] thought his task was to go off and look at the documents, work out what he thought was relevant and find his own primary and secondary facts, going through that material”.[23]
[23]T17527.
Whereas SPI’s written submissions relied on the contention that Dr Hastings has engaged in impermissible fact-finding, the core proposition put during oral submissions was that Dr Hastings has not adequately differentiated between assumptions of fact and expressions of opinion, with counsel describing the reports as “a morass of material”.[24] Counsel for SPI said the issue is not a matter of “proof of assumption” (i.e. whether the facts ultimately bear out the assumptions that have been made) but rather an issue of “statement of assumption” (i.e. whether the assumptions relied upon are clearly articulated as such).[25]
[24]T17535.
[25]T17519-20.
Counsel for SPI says, I think correctly, that the distinction between assumption of fact and expression of opinion needs to be made clear so that counsel knows what case SPI needs to meet in preparing for cross-examination of Dr Hastings.
SPI also argued during oral submissions that Dr Hastings has failed to properly substantiate his opinions, therefore failing to satisfy the requirement articulated in Dasreef that opinions expressed must be wholly or substantially based on expert knowledge.[26]
[26]See, e.g. T17536-7, where counsel for SPI suggested that Dr Hastings has failed to articulate his chain of reasoning in relation to the matters at line 1219 of his first report where Dr Hastings says “A predominantly run-to-failure policy was operating”.
Finally SPI says that, in setting out these factual findings, Dr Hastings has effectively been used to “filter the facts” in a manner that is favourable to Mrs Matthews’ case and is simply acting as an advocate for Mrs Matthews’ position.[27]
[27]See SPI’s written submissions, dated 7 February 2014, [12]; T17530-32.
SPI did not clearly identify the relief it sought in its written submissions. In discussion with counsel for SPI, two possible courses were suggested:
(a) that I strike out those passages of the reports that I hold to be inadmissible. This, I suggested, would result in my asking Dr Hastings to redraft his report; or alternatively,
(b) that I make a declaration as to those matters that I consider to be assumptions of fact (and presumably any that I consider to be findings of fact) and those that are opinion. This, it was argued, would enable counsel for SPI to prepare for and conduct cross-examination effectively.[28]
Mrs Matthews’ submissions
[28]T17561-62.
Counsel for Mrs Matthews says that SPI’s objections are ill-founded and that it is relatively easy to differentiate the assumptions of fact that Dr Hastings has made from his resulting opinions.
Mrs Matthews contends that SPI’s position on this point is a result of reading the identified segments of Dr Hastings’ reports in isolation and out of context. She says that when the statements are read with the whole of the particular report in mind, including the external materials to which the statements are often attributed, the distinction between assumptions of fact and opinion evidence, are clear. She also says that where Dr Hastings makes references to “facts”, these in the main derive from SPI documents that have been provided to Dr Hastings (and are referred to in each report). Where the stated “facts” are not direct extractions from these documents, she says the stated “facts” are, on inspection, clear and reasonable inferences derived from the documents. It is also said that reading the reports in context adequately reveals the chain of reasoning behind Dr Hastings’ opinions.
Should segments of Dr Hastings’ reports be excluded?
As Dasreef makes clear, there are three critical matters that must be established if a party is to rely upon an expert opinion:
(a) the witness must have specialised knowledge resulting from training, study or experience;
(b) the opinion expressed must be wholly or substantially based on that knowledge; and
(c) the opinion must be relevant to the trial issues.
Although it is clear from Dasreef that the determinants of admissibility are the terms of the Evidence Act and not a set of rules gleaned from a raft of earlier cases, it is also apparent (as the extract at [9] demonstrates) that, at least as a matter of procedure, an expert report must set out the factual assumptions that are relied upon by the expert in reaching his or her opinion.
The High Court also explained in Dasreef that the exercise should not, in most cases, be difficult; a microscopic examination of every sentence in a report is unnecessary and unproductive. Rather the question is, as I will explain in a moment, whether the report (or the viva voce evidence) sufficiently identifies the assumed facts and differentiates these from opinion so that the reader can determine how the witness’ opinion results from an application of his or her experience. The court and the parties should be able to understand not only the factual basis for the opinion but also the manner in which the expert’s expertise has been applied to those assumed facts.
With this in mind, I address the four grounds of objection. Before doing so, however, I should comment on SPI’s submissions.
I repeat that, in its written submissions, SPI has undertaken an excruciatingly detailed analysis of Dr Hastings’ reports and identified a large number of passages that it says should not be admitted. Ultimately, I think this analysis is distracting and unhelpful. For a court to undertake the same task, and then to undertake the correlative task of determining whether those statements can be unbound, is unthinkable – at this stage of a trial of this size or, indeed, in any trial. Rather, the exercise that I suggest would apply in most cases is this: examine the report as a whole and determine whether the reader can sensibly distinguish between assumed facts and the expression of opinion based on the witness’ expertise.
Failure to distinguish between primary and secondary facts
As I mentioned earlier, SPI’s written submissions focused on an asserted failure by Dr Hastings to adequately distinguish between “primary” and “secondary” findings of fact. On this basis, SPI has submitted that certain segments of his reports ought not be admitted.
SPI’s reference to “secondary” facts appears to align with the reference made to “intermediate” propositions in the NSW Supreme Court’s decision in ASIC v Rich[29] in which Austin J distinguished between “primary” and “intermediate” propositions.[30] His Honour’s decision was successfully appealed – although not on the question of distinction between primary and intermediate (or secondary) propositions. The case involved an intricate analysis of a voluminous and complex accountant’s report relied upon by ASIC in its civil penalty case against Mr Rich. I respectfully question the utility of that distinction in a case such as this, particularly in light of the High Court’s observations in Dasreef.
[29](2005) 190 FLR 242.
[30]“[T]hey purport to provide a bridge, or more accurately a series of connecting bridges, between the documentary evidence and the ultimate conclusions expressed in answer to ASIC’s questions. The intermediate propositions often have the appearance of propositions of fact, but a full reading of the Report (including footnotes) shows that these propositions purport to be derived from the documents, through processes of reasoning, such as by inference or through calculations” and “I have explained that the Carter Report contains many intermediate propositions, which are steps along the path of reasoning from the disclosed documents which are identified in the Report as the assumed facts, to the ultimate conclusions in answer to ASIC’s questions. There is an issue whether to categorise these intermediate propositions as assumed facts, or representations of fact, or statements of opinion. If they are representations of fact, in most cases they will be inadmissible to prove the facts so represented, by virtue of the hearsay rule as stated in s 59. If they are representations in the nature of assumptions, they may be admissible under s 60, even though hearsay, but subject to an order under s 136 limiting their use to establishing the factual basis upon which the expert holds his or her opinions, and not for the purpose of proving the facts that are assumed.” ASIC v Rich (2005) 190 FLR 242, 257 [53], 304 [262].
In my view – at least in this case – the distinction between primary facts and secondary (or intermediate) propositions only confuses and mystifies what is a basic requirement: identification of the assumed facts as distinct from opinion evidence.
I do not accept, as SPI argued, that an expert is required, in terms, to identify and explain the underlying basis of “secondary” propositions: whether an assumed fact is a result of inferential reasoning or established on its own account is not to the point. What is important is whether it is clear that the expert is referring to an assumed fact as opposed to an opinion.
This approach accords with the general proposition stated by Gleeson CJ in HG v The Queen:
an expert whose opinion is sought to be tendered should differentiate between the assumed facts upon which the opinion is based, and the opinion in question.[31]
Once the assumed fact is identified then the trier of fact (be it judge or jury) is in a position to determine whether the assumption conforms with the evidence as assessed at the conclusion of the trial. As Spigelman CJ said in the appeal in ASIC v Rich:
The issue for a trial judge is whether the opinion expressed to be based on the facts proved or assumed is correct. In determining the issue, the judge will have regard, among other things, to the reasoning process (based on those facts) used by the expert. The mere fact that the expert’s opinion is based on facts that are assumed (and not proved) at the time the expert gives evidence is no reason to exclude the evidence at that stage. … The fact that the opinion was initially formed or later reinforced by reference to other facts, not said by the expert in his evidence to be proved or assumed, is irrelevant to the question of admissibility. Once the opinion is capable of being based on the proved facts, it is admissible.[32] (emphasis added)
[31]HG v The Queen (1999) 197 CLR 414, 427 as cited in ASIC v Rich (2005) 194 FLR 242, 305 [266].
[32]ASIC v Rich (2005) 218 ALR 764, 794 [136].
As I will explain in a moment, I think the basic distinction between assumed facts and opinion is apparent in both reports. Accordingly, I reject SPI’s argument that the reports are inadmissible on the basis that they fail to differentiate between primary facts and secondary propositions.
Has Dr Hastings engaged in a fact-finding exercise?
This leads to consideration of the more general proposition put by SPI: that Dr Hastings has engaged in an impermissible fact-finding exercise.
Mrs Matthews’ lawyers provided Dr Hastings with a series of questions; these required him to describe SPI’s asset management practices and then to give his opinion as to whether these were appropriate. In other words, Dr Hastings was not provided with a prepared statement of assumptions but was required to derive this information himself from the documents provided.
In my opinion it is clear, from a sensible reading of the two reports, that Dr Hastings has referred to and relied upon the materials provided in order to identify (insofar as is possible when relying on a selection of documents) the nature of SPI’s asset management policies and practices. This was a necessary precursor to then offering his opinion as to the appropriateness of these practices. Dr Hastings’ descriptions of SPI’s policies and practices emanate almost exclusively from the documents and are clearly referenced in his discussion of them. It matters not, for current purposes, whether those assumptions are accurate or reflective of the evidence given in this trial; if they are not, this will, at least, go to the weight of Dr Hastings’ opinions.
I simply do not understand the criticism by SPI of the process adopted by Dr Hastings in producing his reports. Surely it is in the interests of justice to permit an expert to examine the materials provided free from the potentially biased or preconceived view of the facts that a party’s lawyer may have when providing “assumptions of fact”. Even if not so skewed, the assumed facts may be incomplete or inadequately set out due to a lack of expert knowledge on the part of the lawyer.
Accordingly I reject the proposition that these aspects of the reports constitute “findings of fact”. Similarly, I see no reason to infer that Dr Hastings was confused about the nature and scope of his role and mistakenly undertook the role of fact-finder.
Is there a sufficient distinction between Dr Hastings’ assumptions of fact and his opinions?
This is the critical issue.
I accept that Dr Hastings’ reports do not, to the letter, follow a traditional expert report structure of setting out explicitly and in separate sections the assumptions of fact, other evidentiary material relied upon (e.g. other studies or reports), and opinion(s). However, his opinions, at least in his first report, generally fall under his ultimate paragraph in each section (described as the “consequences” subsections). Although this has meant the process of identifying his opinions has required closer attention, it is not, on its own, a bar to the evidence being received. His evidence will be admissible if the criteria outlined in Dasreef can be satisfied upon a reading of the reports.
In my view, the structure of Dr Hastings’ first report largely delineates what he understands to be SPI’s practices (the subsections headed “SPI as at Feb 2009”) and his opinions as to the consequences of these practices for the safety and reliability of the Valley Span (the subsections headed “Consequences for the Valley Span”). Although there are instances where Dr Hastings provides comments in the “practices” subsections, I generally accept the submission made by counsel for Mrs Matthews that these comments offer a preliminary explanation as to the significance of those assumed facts with further opinion following in the “consequences” subsection. In doing so, these comments help demonstrate Dr Hastings’ chain of reasoning from the assumptions of fact to his final opinions.[33]
[33]T17586.
Whilst I am firmly against a line by line analysis of SPI’s objections to Dr Hastings’ report, it is useful to look at a small selection of the passages identified by SPI.
In section 4.2 of his first report, Dr Hastings sets out a summary of SPI’s conductor asset management policy, operative as at February 2009:
Condition Monitoring:
“This asset is monitored through visual inspection during line inspection program and thermovision surveys.”
Failure History:
“This asset fails at generally 200 events per year based on average of the last 15 years.”
Known defects or problems:
“This asset suffers from problems related to:
- joint failure
- corrosion of steel conductor and tie wires
- vegetation damage
- third party damage
- overload and fault current
- moisture ingress in ABC joints
- erosion due to vibration”
The consequences of failure are:
“- loss of feeder and all attached customers
- loss of one phase and attached customers
- possible fire
- public hazard and possible death”
Maintenance strategy:
“The maintenance strategy is run to failure and repair of identified defects from condition monitoring practices.”
Replacement strategy:
“The replacement strategy is replace identified problem sections based on performance and conditions.”[34]
[34]EXP.CAM.011.0001, 0016-7. This extract is also included at section 3.1 of Dr Hastings’ second report (EXP.CAM.012.0001, 0004-5).
SPI says that it is not clear whether Dr Hastings has simply taken the above as a factual statement of SPI’s policy as at February 2009 or if it is his opinion as to the content of SPI’s policy. SPI also contends that if it represents his opinion, it is not based on his expertise and is therefore inadmissible.
However, this information comes directly from two SPI documents – the 2007 and 2008 “Electricity Detailed Asset Profiles”[35] – and is introduced by Dr Hastings as useful background for the subsequent sections of his first report. Reading these extracts in the context of the entire report, as well as Dr Hastings’ instructions, this outline is not the expression of opinion evidence but rather his identification of SPI’s conductor asset management policy for the purposes of his report and is achieved by extracting this information directly from SPI documents. Of course, if SPI wishes to challenge the accuracy of these assumptions it is free to do so in cross-examination.
[35]SPN.802.099.0007 (“Conductors” tab); SPN.802.099.0006 (“Conductors” tab).
The next example relates to section 5 of the first report which addresses “Policies and practices for collection and analysis of data”.[36] In section 5.2, Dr Hastings sets out a summary list of SPI’s data management systems with reference to other relevant sources. Section 5.2.1 then goes on to say, in part:
The data needed to manage an extensive system of assets should be accurate and well organised. The data management systems in use by SPI for its SWER network prior to February 2009 are described in internal documents as being not well coordinated and containing inaccuracies. This is primarily because the Asset Register system Q4 and the Outage Management system PowerOn are not closely linked.
The following points are taken from SPI’s 5 year Asset Management Plan 2005
“4.3 System Relationships”
“Identification of the asset type and location that failed, mode, cause, and consequence of the failure is either not captured or insufficiently captured to allow easy and accurate analysis.” …. “The process for associating and capturing asset failures in Q4 against the asset is ad hoc and manual.”
Similar comments were made in the AON Condition of Assets report in 2000. That report indicated the lack of a process to gather data to determine average engineering life of various classes of asset, and that age at replacement was not captured systematically for all assets. This indicates that the problems associated with data capture in relation to lives of assets were long standing.[37]
[36]EXP.CAM.011.0001, 0017-20.
[37]EXP.CAM.011.0001, 0018. (citations omitted)
In oral submissions counsel for SPI contended that, when Dr Hastings says “This is primarily because the Asset Register system Q4 and the Outage Management System Q4 are not closely linked”, it is not clear whether this is a statement of assumed fact (derived from SPI documents either directly or by inference) or opinion. However, when one goes to the source document, it is clear that the statement is derived directly from it and involves no injection of opinion. It is also relevant that the extract appears in an SPI “practices” rather than “consequences” subsection of the report: as I remarked earlier, the SPI “practices” sections appear, as a general rule, to contain assumptions of fact (sometimes accompanied by commentary concerning the significance of these assumptions).
Finally on this analysis, counsel for SPI criticised aspects of section 6.2 of Dr Hastings’ first report, which sets out SPI’s practices concerning “Asset Life Spans”. One aspect was section 6.2.1. SPI extracted a large part of section 6.2.1 in its written submissions although in oral submissions counsel specifically drew attention to the following line:
Numbers of failures of conductors were significant by 2008.[38]
Counsel suggested that the meaning of this statement – specifically the use of the term “significant” – is unclear. However, the statement must be read in context. It was followed directly by the quote “Conductor failures due to deterioration have averaged 47 per annum in recent years”, which was in turn followed by:
This was recognised by SPAusnet as presenting:
“considerable risk to the business from a public safety and bushfire perspective.”[39]
[38]EXP.CAM.011.0001, 0021. (citation omitted)
[39]EXP.CAM.011.0001, 0020-21. (citation omitted)
The final comment comes from an identified SPI document which also refers to conductor failures.[40] As I see it, Dr Hastings’ description of 47 failures per year is his assumption of fact, and the description of it as “significant” is a derived opinion as to its significance, based on his expertise. Dr Hastings is setting out what he has taken from SPI documents as appropriate assumptions of fact.
[40]SPN.012.004.0001, 0008-9.
The above examples are sufficient to explain my conclusion on this point. For the sake of completeness, I should mention that I have read the second report carefully. In my view, on the whole the differentiation between assumptions of fact and expressions of opinion based on expertise in both reports is adequately clear.
Has Dr Hastings sufficiently substantiated his opinions by reference to his expertise?
A number of SPI’s objections to segments of Dr Hastings’ reports were based on the submission that Dr Hastings has failed to adequately link his opinions to his expertise. I do not accept that this has been established. I take one example from the first report.
Section 5.3, a “consequences” subsection, addresses the consequences of the identified data collection and analysis policies and practices for the safety and reliability of the Valley Span. Dr Hastings says the following:
The data management systems in use by SPI in the years leading up to February 2009 fell short of appropriate practice in that they were:
·structurally diverse
·contained inaccuracies
·maintenance records prior to 1999 were lost
·not well suited to analysis for maintenance policy purposes
·lacked information on span characteristics (sic)
The consequences of departures from appropriate practice was to inhibit the feedback and analysis of reliability and maintenance data. …
The point is illustrated by the Vibration Damages document … Maintenance and engineering management should have provided an earlier response to the linesmen’s comments and corrective action should have occurred. Given the incidence of vibration related failures, I consider that a suitable corrective response would have led to action to mitigate vibration problems, such as fitting vibration dampers and reducing fatigue risks well prior to 7 February 2009.[41] (emphasis added)
[41]EXP.CAM.011.0001, 0019-20. (citations omitted)
Referring to the segment of the above quote that I have italicised, counsel for SPI submitted that “these are just assertions without any statement of reasoning which is linked back to the expertise that he has”.[42]
[42]T17542.
Dr Hastings is an expert in asset management. It is patent that his conclusions are an application of his expertise to the assumed facts. It would be a nonsense if an expert had to preface every statement of opinion with a remark such as “Based on my experience and learning, I am of the opinion that…” Rather, as the High Court noted in Dasreef, often the exercise is simple and can be readily recognised as, in my view, is the case here.
SPI’s written submissions also attacked a number of passages in Dr Hastings’ second report. I will again deal with these by way of a selected example.
Section 4 of the second report addresses conductor maintenance policy, with section 4.2 addressing condition monitoring. Section 4.2.2 extracts section 6.2 from SPI’s Asset Inspection Manual – “6.2 Guide to Conductor Deterioration”. SPI objects to section 4.2.3.1 in which the following appears:
The Asset Inspection Manual states that the condition of conductors can only be assessed from line height, but the practice was to inspect from the ground. An aerial inspection option had been available within SPAusnet but was only used on specific request. It was discontinued in the North and East regions in 2007. …[43]
[43]EXP.CAM.012.0001, 0008. (citations omitted)
SPI criticises this statement on the basis that the matters contained in the Asset Inspection Manual are taken as fact and do not represent an application of his expertise. If it were the case that Dr Hastings was engaging in a fact-finding exercise, or expressing an opinion, then the question of his chain of reasoning would be a real point. However, it is clear beyond argument that Dr Hastings has simply extracted content from SPI materials and taken it as assumed fact for the purpose of reaching his opinion. If the assumed fact proves to be inaccurate then Dr Hastings’ opinion(s) based on that assumption will necessarily fall away.
I am satisfied that the opinions expressed by Dr Hastings in his reports can be readily discerned as resulting from the application of his expertise. The chain of reasoning is sufficiently exposed.
Is Dr Hastings an advocate for Mrs Matthews’ case?
Finally, there is SPI’s contention that Dr Hastings is an advocate for Mrs Matthews’ case. SPI’s argument was essentially that, by making findings of fact when not entitled to, Dr Hastings was effectively acting as Mrs Matthews’ advocate.
In Rees v Lumen Christi Primary School Robson J said:[44]
An expert witness’ paramount duty is to assist the court impartially. That duty overrides the expert witness’ obligation to the engaging party. An expert witness is not an advocate for a party.[45]
[44][2010] VSC 514, [27].
[45]Rees v Lumen Christi Primary School [2010] VSC 514, [27(g)].
This proposition was emphasised by Dixon J in Clark v Ryan,[46] a seminal case on opinion evidence under the common law,[47] and repeated by Gleeson CJ in HG v The Queen[48] in which his Honour said:
… in trials before judges alone, as well as in trials by jury, it is important that the opinions of expert witnesses be confined, in accordance with s 79, to opinions which are wholly or substantially based on their specialised knowledge. Experts who venture “opinions” (sometimes merely their own inference of fact), outside their field of specialised knowledge may invest those opinions with a spurious appearance of authority, and legitimate processes of fact-finding may be subverted.[49]
[46](1960) 103 CLR 486.
[47]The High Court held that expert witnesses are not permitted “to attempt to point out to the jury matters which the jury could determine for themselves” and held that in that case, an expert witness had given evidence outside the scope of “expert evidence”: (1960) 103 CLR 486, 491-2.
[48](1999) 197 CLR 414.
[49](1999) 197 CLR 414, 429 [43].
I have already concluded that Dr Hastings has not made findings of fact but has simply made assumptions of fact as a necessary part of his task. There is nothing in his reports that would lead me to conclude – at least at this time – that Dr Hastings has taken on the role of an advocate. As far as I can tell his opinions, whilst favourable to Mrs Matthews’ case, appear to be based on the application of his expertise to the assumed facts.
Conclusion
As an expert engaged to opine as to the adequacy of SPI’s asset management systems and practices, Dr Hastings was tasked with forming and presenting opinions, giving particular consideration to a number of identified issues (e.g. asset inspection, the fitting of vibration dampers, etc). A necessary precursor to this task was the identification of those systems and practices. To do so, Dr Hastings was provided with a large number of documents, predominantly authored by SPI personnel.
In my view, it is clear that Dr Hastings has endeavoured to extract or deduce from those documents SPI’s asset management systems and practices. In each section of his reports, he has identified what he understood those systems and practices to have been (therefore constituting his assumptions of fact) and has then opined as to their significance and/or adequacy.
I am satisfied that, in both reports, it is possible to distinguish between Dr Hastings’ assumptions of fact and his opinions. I am also satisfied that Dr Hastings has demonstrated the link between his opinions and his expertise. Of course, it remains open to SPI to delve further into the issues in cross-examination.
I am not satisfied that Dr Hastings has engaged in his task as an advocate. On the basis of his reports, there is no reason for concluding that he has provided his expert opinion other than in accordance with the requirements of the CPA and the Supreme Court Rules.
Accordingly, there is no reason to refuse to admit Dr Hastings’ reports – in whole or in part.
SCHEDULE OF PARTIES
BETWEEN
CAROL ANN MATTHEWS Plaintiff
and
SPI ELECTRICITY PTY LTD (ACN 064 651 118) First Defendant
UTILITY SERVICES CORPORATION LIMITED
(ACN 060 674 580) Second Defendant
SECRETARY TO THE DEPARTMENT
OF ENVIRONMENT AND PRIMARY INDUSTRIES Third Defendant
COUNTRY FIRE AUTHORITY Fourth Defendant
STATE OF VICTORIA Fifth Defendant
and
SPI ELECTRICITY PTY LTD (ACN 064 651 118) Plaintiff by Counterclaim
and
UTILITY SERVICES CORPORATION LIMITED
(ACN 060 674 580) First defendant to Counterclaim
SECRETARY TO THE DEPARTMENT
OF ENVIRONMENT AND PRIMARY INDUSTRIES Second Defendant to Counterclaim
COUNTRY FIRE AUTHORITY Third Defendant to Counterclaim
STATE OF VICTORIA Fourth Defendant to Counterclaim
CAROL ANN MATTHEWS Fifth Defendant to Counterclaim
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