NCON Australia Ltd v Spotlight Pty Ltd

[2011] VSC 47

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

No. 8246 of 2009

NCON AUSTRALIA LIMITED (ARBN 099 019 851)	Plaintiff
v
SPOTLIGHT PTY LTD (ACN 005 180 861)	Defendant

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JUDGE:	ROBSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	22 February 2011
DATE OF RULING:	22 February 2011
CASE MAY BE CITED AS:	NCON Australia Ltd v Spotlight Pty Ltd
MEDIUM NEUTRAL CITATION:	[2011] VSC 47

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EVIDENCE – expert evidence – whether relevant to fact in issue in the proceedings – s 55 Evidence Act 2008

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Dr R L Dean Dr M R Sharpe	Peter G Richards
For the Defendant	Mr R Garratt QC Ms R B Sion	Cornwall Stodart

HIS HONOUR:

1. Spotlight alleges that it was a term of the agreement constituted by the proposal and the services agreement that NCON’s Smart Power Control System would not result in any perceptible light loss.

1. The proposal said as follows:

   The “Yes” box provides energy savings, power factor correction, demand reduction and relamping/maintenance cost savings for fluorescent and metal halide lighting.

   Reduced consumption translates to savings on lighting costs of around 30% per annum, with imperceptible light loss, while increasing lamp light.  There are a number of “Yes” box models available covering from 100 to 600 lamps.

2. The defendant further alleges that testing conducted by NCON in Spotlight’s presence at a Lincraft store in Frankston, Victoria in May 2008 identified a lux level loss of approximately 25%.

1. Spotlight alleges that in the circumstances NCON was in breach of the agreement constituted by the proposal and the service agreement in that it could not deliver its Smart Power Control System without there being an accompanying perceptible loss of light.

1. NCON, in its amended reply, states that it denies that NCON carried out the test alleged by Spotlight, but admits that a test was conducted at a Lincraft store in Victoria in May 2008 by or on behalf of Spotlight.

1. NCON says further that the test was carried out by an unqualified person, it was unscientific, the methodology was flawed and the result was erratic and inconclusive.

1. Further, NCON says that if there was a lux light level loss of approximately 25% (which is denied), such loss was due to the lamping which were at the end of their operational life, not as a result of the system.

1. NCON further alleges that the system results in an average interior light loss of, in typical uncontrolled ambient circumstances, 20% and as low as 4.3% in controlled circumstances, and that the system applicable to Spotlight would have resulted in average interior lux (light) loss of 20%, which is loss imperceptible to the trained and naïve eye.

1. NCON further says that if the average loss of light was 25% (which is not admitted but denied), such loss is imperceptible to the trained and naïve eye.

1. NCON seeks to rely upon an expert report of Dr Michael Pianta and another of Dr Steve Jenkins.

1. Dr Jenkins has a PhD from the Department of Optometry, University of Melbourne, and has had considerable experience as a research scientist into visual perception and lighting.  Dr Pianta has a PhD from the University of Melbourne and is currently a lecturer in the Department of Optometry and Vision Sciences at the University of Melbourne.  Dr Jenkins has prepared a report based on the operation of the “Yes” box at Myer at Highpoint in a retail shop.  He has measured the reduction in vertical illumination occasioned by the use of the box and calculated the average reduction in vertical illumination is 20%.  In substance, he says that the loss of visual performance when going from bypass mode to safe mode with the “Yes” box is negligible.

1. Dr Pianta, in a detailed report, concludes in summary that a 20% loss of light would have an imperceptible effect on reading and the detection and identification of objects.

1. Spotlight objects to the tendering of the expert evidence. Section 55(1) of the Evidence Act 2008 provides:

The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding.

1. The critical issue is whether the evidence could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue.

1. In my view, the first task is to interpret the contractual clause.  I do not consider it appropriate to make a final decision on the construction of the agreement (if there be one).  My preliminary view is that the reference to an imperceptible light loss is a reference to a perception by an average typical person not suffering from any visual defect.

1. Accordingly, in my opinion, the question raised by the application of the clause is an objective question.  The answer is not necessarily satisfied by the experience of any particular individual giving evidence as to whether or not the loss of light was imperceptible to him or her.  Rather, in my opinion, it is a matter upon which expert evidence can be adduced to give evidence of the usual abilities of the typical person in perceiving the loss of light who does not suffer from any visual defect.

1. The imperceptibility must be in a relevant environment.  Spotlight suggests that the relevant environment is that of a typical Spotlight store.  I am prepared to proceed on that assumption even though the interpretation may be wider to include a retail shop selling haberdashery items typical of what Spotlight sells. 

1. Thirdly, my preliminary view is that the illumination referred to is the illumination of the objects in such a store rather than the perception of an observer looking at the lights themselves or the perception of an observer of the moment of switching from the box being off to the box being on. 

1. Thus on this interpretation of the relevant clause, the facts in issue are whether the system provided an imperceptible light loss to an average typical person in a Spotlight store when observing the objects displayed in the store (rather than the lights above) when the system is on compared to when the system is off.

1. In my opinion, the test carried out in the Myer store could rationally affect (directly or indirectly) my assessment of the probability of these facts and the opinions of both Dr Pianta and Dr Jenkins on the matters of illumination and the human eye could also rationally affect (directly or indirectly) my assessment of the probability of these facts.

1. Accordingly, I will allow the expert evidence to be led subject to any other objections Spotlight may have to any particular parts of the reports of the experts.