Richards v Macquarie Bank Ltd (No 2)

The case of Richards v Macquarie Bank Ltd (No 2) involved the admissibility of tendency evidence in relation to representations made by financial advisers of Storm Financial Services to multiple customers. The primary legal issue was whether the tendency evidence met the "significant probative value" condition as set out in section 97 of the Evidence Act 1995 (Cth). This evidence was sought to be introduced to establish a pattern of misleading or deceptive conduct by Storm in its dealings with the applicant, Mrs Richards. The court had to weigh the probative value of the evidence against the potential for prejudice, confusion, or undue waste of time.

The Federal Court considered whether the tendency evidence, which included representations made to 12 other customers by different financial advisers, had significant probative value in proving the alleged representations made to Mrs Richards. The court examined the similarity in nature of the representations, the timing and circumstances of the events, and the overall significance of these incidents within Storm's operations. The court concluded that the tendency evidence did not have significant probative value due to the stark differences in timing, circumstances, and the relatively minor fraction of Storm's operations these incidents represented. Consequently, the tendency evidence was deemed inadmissible under section 97 of the Evidence Act.

The court found that the tendency evidence did not meet the "significant probative value" requirement and, therefore, could not be admitted. This decision was based on the lack of striking similarities between the representations made to Mrs Richards and those made to other customers, coupled with the minor impact of these incidents on Storm's overall operations. The court's reasoning was grounded in the statutory language of the Evidence Act and the need to balance the probative value of the evidence against the risk of undue prejudice or confusion. The court's conclusion effectively precluded the introduction of the tendency evidence in the trial.