NAB v Garry

[2003] NSWSC 22

CITATION:	NAB v Garry & anor [2003] NSWSC 22 revised - 13/02/2003
HEARING DATE(S):	03/02/03
JUDGMENT DATE:	3 February 2003
JUDGMENT OF:	O'Keefe J
DECISION:	Witness determined to be an expert able to express opinions on the subject matters objected to.
CATCHWORDS:	Evidence - Expert - Ambit of expertise - Opinion evidence - Comparison between the rule of admissibility of opinion evidence under the common law and under the Evidence Act, 1995.
LEGISLATION CITED:	Evidence Act 1995: s 79, 135
CASES CITED:	Carter v Boehm 1 Smiths Leading Cases 7th Ed. (1876) 577 Clark v Ryan (1960) 103 CLR 486 Makita Australia Pty Ltd v Sproule (2001) 52 NSWLR 705 HG v the Queen (1999) 197 CLR 414
PARTIES :	National Australia Bank John Joseph Phillip Garry and Marilyn Gail Garry Elders Limited John Davis and others
FILE NUMBER(S):	SC 12479/98
COUNSEL:	Plaintiff and first cross defendant - Mr D Williams Defendants - Mr R Walker Second cross defendant - Mr J Stevenson Third cross defendant - Mr J Kelly SC with Mr G McNally
SOLICITORS:	Plaintiff and first cross defendant - Mr Dale J Kemp: Dibbs, Crowther & Osborne Defendants - Mr John Conti: Boyd House & Partners Second cross defendant - Mr Andrew Kingsford Smith: Henry Davis York Third cross defendant - Mr Philip Harris: Harris McHugh Lawyers (Tamworth)

- 4 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

O'KEEFE J

Monday 3 February 2003

12479/98 NAB v Garry & anor

JUDGMENT - on admission of affidavit of Peter Middleton Simpson sworn 20/09/2001

1 O’KEEFE J: Counsel for the defendants has sought to read an affidavit of Peter Middleton Simpson of 20 September 2001, a financial consultant who was formerly an employee of the Westpac Banking Corporation.

2 Objection has been taken to Mr Simpson expressing an opinion in relation to three questions that are concerned with the appropriateness of the plaintiff’s (Bank's) actions in relation to: first, a proposed deed of settlement between the bank and the defendants; second, the appropriateness of the Bank's action in relation to that deed; and third, the appropriateness of the Bank's action in relation to the auction of the defendant’s property known as Birroon.

3 The objection taken has two bases. The first is that Mr Simpson has not demonstrated that expertise in a relevant field which is necessary to entitle him to give opinion evidence. The second is that, even if he has so demonstrated, the evidence should nonetheless be rejected pursuant to the discretion conferred by s 135 of the Evidence Act, 1995.

4 The resolution of the objection depends upon an application of both the Common Law and the provisions of the Evidence Act 1995. Under the Common Law, the rule in relation to the admissibility of opinion evidence by a person said to be expert is as set out by JW Smith in the notes to Carter v Boehm, 1 Smiths Leading Cases 7th ed (1876) p 577.

5 The statement of the law in that reference was endorsed by Dixon CJ in Clarke v Ryan (1960) 103 CLR 486 at 491. It is as follows:

"On the one hand it appears to be admitted that the opinion of witnesses possessing peculiar skill is admissible whenever the subject matter of the enquiry is such that inexperienced persons are unlikely to prove capable of forming a correct judgment upon it without such assistance. In other words, when it so far partakes of the nature of a science as to require a course of previous habit or study in order to the attainment of the knowledge of it...While on the other hand it does not seem to be contended that the opinions of witnesses can be received when the enquiry is in relation to a subject matter the nature of which is not such as to require any particular habits or study in order to qualify a man to understand it."

6 The matters on which counsel for the defendants seeks to press Mr Simpson's opinion are matters of banking practice, procedure and propriety.

7 Mr Simpson is a person who, the curriculum vitae annexed to his affidavit reveals, is a person with vast experience in the banking industry. He spent 35 years in that industry, moving from the very bottom of the banking tree to what might be regarded as the very top of that tree, retiring in 1993. During that time he held a number of positions which included those relating to securities, security documents and the like, and managerial positions at various levels including international levels. He is a person who, in my opinion, demonstrates in his curriculum vitae an extensive knowledge of banking practice, procedure and, as a consequence, those matters of propriety that may be associated with banking and banking procedure.

8 Banking itself is in some senses a fairly straight forward matter. In others, it is somewhat arcane since there are internal practices, procedures and proprieties which apply, unknown in the main to the layperson of which the court forms one.

9 Under the Common Law I am of the opinion that Mr Simpson is a person with practical experience in banking, as well as one who has probably studied banking procedures over a very long period and, as such, is apt to express opinions in relation to matters of banking, including those relating to securities and their enforcement.

10 Counsel for the plaintiff has argued that s 76 of the Evidence Act 1995 precludes the admission of opinion evidence from Mr Simpson and that the exempting provisions of s 79 of that Act have no application to him. Section 79 of the Evidence Act 1995 provides:

"If a person has specialised knowledge based on the person's training, study or experience, the opinion rule ( ie the rule of exclusion expressed in s 76 of the Act ) does not apply to evidence of an opinion of that person, that is wholly or substantially based on that knowledge." (Italics added)

11 Mr Simpson is a person who has specialised knowledge based on his training, probably study and certainly experience, and such expertise extends over the widest range of banking. I am satisfied that it embraces securities and their enforcement.

12 However, it is further argued on behalf of the plaintiff that the expertise of Mr Simpson is not relevant to the areas of discourse on which his opinions have been sought.

13 In support of this contention it has been argued that on the authority of Makita Australia Pty Ltd v Sproule (2001) 52 NSWLR 705 and the decision of the High Court in HG v the Queen (1999) 197 CLR 414, Mr Simpson's opinions are not grounded in the way which those two authorities require.

14 In Makita, the court was concerned with the expression of an opinion by a professor who was skilled in a particular area of physics and behaviour of physical items. However, the opinion that was expressed in that case was not shown to arise out of expertise related to factual material revealed in his report. As Heydon JA said, he thought that the material was:

"…not based on specialised expert knowledge but...on 'a combination of speculation, inference, personal and secondhand views as to the credibility of the complainant and a process of reasoning that went well beyond the field of expertise'" (supra at paragraph 85.)

15 In the present case Mr Simpson has set out in the body of his report the material on which he relied in order to arrive at his conclusions. It has been argued that such material is not the totality of material and therefore his opinion should not be accepted on the basis that it falls foul of what was said by Heydon JA in Makita. I do not think this is correct. Furthermore, when regard is had to HG v The Queen and the opinion that was there being referred to by Gleeson CJ, it is very different from the present case. In HG v the Queen the opinion in question was that of a clinical psychologist who was seeking to opine as to whether or not a particular complainant had been sexually assaulted in 1987, rather than in 1992 and 1993. There was nothing revealed in the report of the clinical psychologist under consideration in that case to indicate that he had any experience or expertise in determining the date or dates, some years before, on which a sexual assault was said to have occurred. Indeed, it was in this context that Gleeson CJ said that on a reading of his report and his evidence, it was revealed that:

"… it was based on a combination of speculation, inference, personal and secondhand views as to the credibility of the complainant and the process of reasoning that went well beyond the field of expertise of the psychologist." (supra at 428).

That is a very different case from the present.

16 Furthermore, I do not think that in expressing his opinion Mr Simpson is usurping the role of the court, or advancing from the witness box the inferences and hypotheses on which the defendant wishes to rely in this case. What the material is concerned with is assisting the Court in a specialised field by a body of evidence from a person who knows banking and how banks do and should operate, his view as to the appropriateness or otherwise of significant actions in relation to the sale of the defendants’ property, Birroon.

17 In my opinion the evidence sought to be advanced through Mr Simpson is based upon training, probably study and certainly experience. Indeed it is based on a virtual lifetime of banking experience at all levels. It qualifies, in my opinion, both under the Common Law or under s 79 of the Evidence Act 1995 for admission as expert testimony.

18 An alternative or additional argument put on behalf of the plaintiff was that even if the evidence of Mr Simpson should "squeak over the line", it should nonetheless be rejected because it falls foul of s 135 of the Evidence Act 1995. That section provides that:

"The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence may:
(a) be unfairly prejudicial to a party; or
(b) be misleading or confusing; or
(c) cause or result in undue waste of time."

19 The evidence, in my view, has probative value and I am not satisfied that such probative value is substantially outweighed by any of the dangers referred to in s 135.

20 First, s 135(a) is not concerned merely with the fact that evidence adduced may be prejudicial. Evidence adduced in a party’s case is adduced with the end in view of proving that party’s case and to the extent that it may do so, it will be prejudicial to an opposing party. But s 135 is not concerned with all prejudice. It is concerned with “unfair” prejudice and nothing has been put to me as to why the prejudice, if any, that would result from the admission of the evidence would be unfair. It is evidence sought to be adduced against a Bank, one of the largest banks in this country, a Bank which will have many, many employees, many of whom will be competent to deal with the very matters that Mr Simpson deals with. I fail to see in those circumstances, with its personnel and other resources, how the adducing of such evidence would be unfairly prejudicial to the defendant. I am satisfied that it would not be.

21 The second limb of s 135, namely, that expressed in s 135(b), is that the evidence may be misleading or confusing. That claim sits ill with the claim made by counsel for the Bank that the evidence is no more than commonsense. Commonsense ought not of its nature be misleading or confusing. On the face of it I do not see anything misleading or confusing in the evidence. However, in support of what I understood to be this limb of the argument, it was suggested that the totality of the material on which an opinion should ultimately be formed is not expressed in Mr Simpson’s affidavit or annexed documents. That may be so, but the basis on which he has formed his opinion and the opinions which he has formed are clearly set out in the affidavit. There is nothing on the face of them that is misleading or confusing. The introduction of additional material in cross-examination may or may not cause Mr Simpson to revise his opinions, but that does not mean that his evidence should, in the first instance, be rejected pursuant to s 135. I do not think that the evidence sought to be adduced through him is misleading or confusing. That ground of objection fails.

22 The final ground, which was not actually pressed by counsel for the plaintiff but deserves consideration, is that if allowed the evidence may cause or result in undue waste of time. It will undoubtedly take time to deal with the evidence. I do not think, however, having regard to the issues raised in the case, that hearing such evidence and having it dealt with is a waste of time. Indeed, it goes to the very core of this matter. Secondly and in any event, what is undue and what is not undue in terms of waste of time is a matter of judgment. Applying one’s experience to the issues, the evidence and the relevant criterion I am of the opinion that allowing the evidence would not cause or result in undue waste of time.

23 For those reasons I do not think that the discretion conferred by s 135 of the Evidence Act 1995 should result in the rejection of the evidence.

24 For the foregoing reasons I am of the opinion that Mr Simpson is an expert able to express opinions in relation to the matters which have been set out in paragraphs 1.1, 1.2 and 1.3 of the statement annexed to his affidavit of 20 September 2001. I am further of the opinion that it would be inappropriate, in the exercise of discretion, to reject the evidence pursuant to s 135 of the Evidence Act, 1995.

**********

Last Modified: 02/14/2003