Searle v Commonwealth of Australia (No.6)

[2022] NSWSC 1326

Supreme Court

New South Wales

Medium Neutral Citation:	Searle v Commonwealth of Australia (No.6) [2022] NSWSC 1326
Hearing dates:	9 March 2022
Date of orders:	9 March 2022
Decision date:	09 March 2022
Jurisdiction:	Common Law
Before:	Garling J
Decision:	See [36]-[37]
Catchwords:	EVIDENCE — opinion evidence — exceptions — expert opinion — whether opinion wholly or substantially based on specialised knowledge
Legislation Cited:	Evidence Act 1995 (NSW) ss 76, 79
Cases Cited:	Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588; [2011] HCA 21
Texts Cited:	Not Applicable
Category:	Procedural rulings
Parties:	Clayton William Searle (P) Commonwealth of Australia (D)
Representation:	Counsel: N J Kidd SC / D Meyerowitz-Katz (P) K Andronos SC / S Keizer (D) Solicitors: Levitt Robinson (P) McCullough Robertson (D)
File Number(s):	2016/45027
Publication restriction:	Not Applicable

EX TEMPORE Judgment

1. Objection is taken to parts of two expert reports tendered by the plaintiff. Those two reports are both written by Mr Matthew Hunter and both refer to specific circumstances relating to Patrick Burnett, one of the sailors whose claims for damages is presently being assessed. The first report is dated 28 October 2021 (the “First Burnett Report”).

2. The second, which is dated 13 January 2022 (“the Second Burnett Report), seeks to correct some arithmetic calculations made in the first report so as to ensure that there is not an inappropriate double counting of particular earnings. It is in that respect that the Second Burnett Report is a supplementary report, the admissibility of which depends upon the admissibility of the first report.

The Witness’ Expertise

3. The author of the reports describes his field of specialised knowledge as being an expert in recruitment and organisational capability development for the naval‑ship building industry and wider defence industry. He says that he has over 27 years of relevant experience. The author was initially a member of the Australian Regular Army, having, as an officer, graduated with the Australian Defence Force Academy and the Royal Military College at Duntroon.

4. He has a Bachelor of Arts degree with Honours from the University of New South Wales, a Graduate Diploma in Technology Management at the University of New South Wales and a Master’s Degree in Human Services Management at Charles Sturt University.

5. After his full‑time service in the Australian Regular Army concluded, he served as an Army Reserve Officer in roles which included line management and appointments to headquarters as a key advisor and as functional lead of technical capabilities.

6. In the civilian world, for five years from 2006 to 2011, Mr Hunter worked in a series of roles with companies called ASC Pty Ltd, formally known as the Australian Submarine Corporation, and ASC Ship Building Pty Ltd.

7. In those various roles, he recruited the ship‑building workforce for the Air Warfare Destroyer Program, consisting of about 1,000 tradespeople in electrical, mechanical and fabrication fields. He designed the pay classification system for the submarine sustainment and maintenance workforce. He managed the Certificate III apprenticeship program for mechanical, electrical and fabrication apprentices which totalled about 140 apprentices at any one time. He managed the production worker pay system including allowances, penalties and pay classifications and negotiated a number of the enterprise bargaining agreements for the Australian Submarine Corporation.

8. In 2011, he became the General Manager of Human Resources at ASC Pty Ltd for a period of about three and a half years where he was in charge of enterprise bargaining, organisational design, workforce planning, internal communication strategy and corporate planning.

9. He has negotiated a number of enterprise bargaining agreements. He was also in that role responsible for the remuneration system for 3,000 employees, accountable for all recruitment activities and accountable for all technical and professional training and development.

10. For two more years, he worked at ASC Pty Ltd as the General Manager of Support Services which meant that he was responsible for the executive leadership of the human resources team.

11. Having left ASC Pty Ltd in September 2016, Mr Hunter established his own consulting business which consulted both private and public sector organisations to prepare them to engage in Australia’s major defence procurement programs through strategy and development of execution team alignment, workforce planning, HR and IR change and talent management solutions. Throughout this time, his work involved him with a range of organisations including governments. Since that time, although under a different consulting company, he has continued his work in the defence, cybersecurity and advanced technology sectors. He is currently a director on the board of a company called Statewide Group Training Limited, a group training company that employs approximately 150 apprentices.

12. In this most recent series of occupations, he has designed workforce skills and education programs including dealing with TAFE in South Australia. He is also involved in identifying and proposing remuneration for apprentices. In all respects, Mr Hunter has had a wide-ranging experience in the area of human resources, recruitment of tradespeople, managing and training of tradespeople and designing pay classification systems and engaging in enterprise bargaining agreements.

13. His work has taken him to places in South Australia, Western Australia, Newcastle and other areas. One matter of importance is that Mr Hunter has had considerable experience in the employment market with tradespeople. For example, when at ASC Pty Ltd, it was necessary for Mr Hunter when recruiting to hire people from around Australia including from Queensland and also internationally. The simple position was that it was not possible to identify all the necessary tradespeople in South Australia.

14. ASC recruited tradespeople across the eastern seaboard who were also of interest to other employers of such tradespeople. Mr Hunter says that as part of his various roles at ASC, he was required to learn what kind of employment conditions were being offered to tradespeople by competitors to the ASC in the marketplace. No doubt because he needed to attract people but also because he wished to negotiate, as he did, enterprise bargaining agreements. This involved looking at labour market conditions, including obtaining reports from consultants paid to do remuneration benchmarks, obtaining survey reports from industry groups such as the Australian Industry Group and Engineers Australia, and commissioning surveys of various trades and matters relevant to recruitment.

15. Mr Hunter has had experience recruiting many individuals who had Certificate III and Certificate IV qualifications in electrical fitting, diesel fitting, refrigeration and air‑conditioning, together with welding and fabrication. In his present role as a director of Statewide Group Training, the apprentices which are employed include electricians, mechanical fitters, fabricators and other traineeships.

16. I am satisfied that Mr Hunter has established that he has specialised knowledge in the areas which I earlier identified, being recruitment and organisational capability development, generally in the industry. In my view, he is qualified to express opinions about the value of the lost opportunity for the claimants in these proceedings to earn income, had they obtained a Certificate IV qualification in Engineering as the Training Contracts identified.

Admissibility of Mr Hunter’s Evidence

17. Objection is taken to the opinions expressed in paragraphs 7.2 and 7.3 of the First Burnett Report. In taking such objections to these and other paragraphs, the Commonwealth rely upon the statements of principle to be found in Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588; [2011] HCA 21, at 604 and following. At [37], the plurality said:

“The admissibility of opinion evidence is to be determined by application of the requirements of the Evidence Act [1995 (NSW)] 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 [(Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705; [2001] NSWCA 305 at [85]], 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.”

18. I accept that that paragraph contains a statement of the principles which are to be applied in considering the admissibility of the two Burnett reports, and the objections taken by the Commonwealth to their admissibility.

19. The structure of the First Burnett Report makes it clear that Mr Hunter was asked to assume two counterfactual scenarios. Putting it shortly, the first is a scenario which involved Mr Burnett obtaining a Certificate IV in Engineering and then discharging from the Navy in October 2016 with such a qualification, and seeking work using that qualification in the Sydney or Wollongong areas.

20. The second counterfactual scenario is one which asks the expert to assume Mr Burnett obtained the Certificate IV in Engineering but remained enlisted in the Navy. With respect to each of those scenarios, Mr Hunter is asked to express an opinion as to what Mr Burnett’s earning capacity would have been from June 2015 to the date of the report.

21. No objection is taken to his opinions with respect to the second counterfactual scenario. However, objection is taken to the first. It is said that the opinions expressed with respect to the first counterfactual scenario are simply unexplained, do not demonstrate that they rely upon the area of specialised knowledge, and do not articulate the steps by which the opinion has been reached.

22. It is put that all one has is a bare opinion arising from assumptions, which is incapable of examination by the Commonwealth, which is the party opposing the tender or, indeed, incapable of evaluation by me when determining the claims. The reasoning, it is said, for all of these conclusions is simply not stated.

23. I don't agree. Let me deal with the objections as I understand them to be.

24. In dealing with counterfactual scenario 1, Mr Hunter has identified two enterprise bargaining agreements, which he uses to assess the loss of earnings, had Mr Burnett sought employment during the relevant period. The two enterprise bargaining agreements are annexed to his report. One, which has assumed significance, is called ARA Electrical Engineering Services Pty Ltd Wollongong Branch Collective Agreement.

25. Mr Hunter notes that he has selected this enterprise bargaining agreement to undertake his exercise of assessing Mr Burnett's loss of earnings because ARA Electrical is the largest division within the ARA group, and is concentrated in the Sydney and New South Wales south coast regions.

26. ARA Electrical, he says, is likely to have had a high probability for employment opportunities. I keep in mind that the scenario invited Mr Hunter to identify the use of a Certificate IV in Engineering in the electrical fitting pathway. The material about ARA attached to Mr Hunter’s report demonstrates that there is a significant scope of work being carried out by that organisation in the southern parts of Sydney, such as Caringbah and Kingsgrove, in Wollongong, and in Nowra.

27. That report demonstrates that ARA is a very large organisation, in financial and workforce terms.

28. The second reason that Mr Hunter says that he has used ARA is that in one of the identified periods, 2016 to 2017, about 70% of ARA’s revenue was generated through servicing activities, which were of a kind which he says would be likely to align well with Mr Burnett's experience as a Navy Marine Technician.

29. In my view, Mr Hunter has set out, in adequate terms, the reasoning, which he has adopted for selecting the ARA Electrical Engineering Services Agreement as being an appropriate measure upon which to base his expert opinion. His knowledge, experience and expertise are more than adequate to justify that as a selection.

30. To the extent that criticism is made of the fact that he has expressed his opinion based upon one enterprise bargaining agreement, that is a criticism which does not go to admissibility of this report. The fact is that that is what Mr Hunter has used, as the basis for his opinion, in assessing counterfactual scenario 1. Whether that’s adequate or worthy of any weight, or could have been done in a different way, does not preclude the admission of his expert opinion.

31. In my view, paragraphs 7.2 and 7.3 are admissible.

32. Between paragraphs 7.4 and 7.9, Mr Hunter deals with the demand for skilled trades between 2016 and 2018 in the Illawarra and south coast regions of New South Wales. In my view, what he there sets out, being the source material, which he has particularly accessed, together with statements made, obviously, from his industry knowledge and experience, permit the expression of the opinions and conclusions in paragraphs 7.8 and 7.9.

33. Objection is taken to paragraph 7.10, subparagraphs (b), (c) and (d), to the extent that they are matters of fact. Particularly as they relate to ARA Electrical Engineering Services, Mr Hunter is not in a position to express those matters as matters of fact. I agree. However, the sub-paragraphs (b), (c) and (d) of 7.10 are also proffered as assumptions upon which calculations are then made. In my view, they are admissible as assumptions, and their worth will be determined by the evidence in the case generally.

34. Objection is also taken to paragraph 7.14. In my view, paragraph 7.14 is to be understood, not as a statement of opinion by Mr Hunter as to what, in fact, this Mr Burnett's loss of earnings is. Rather, it is to be understood as a statement of the possible earnings of Mr Burnett upon the basis of the various assumptions which have been made.

35. Although not expressed with the clarity that a lawyer would seek, Mr Hunter’s opinion must be taken as being that of the possible earnings of a person of Mr Burnett, on the basis of the assumptions made, because, as is obvious from the exercise he was asked to engage in, there was no suggestion that, at any time, Mr Burnett, in fact, had any specific job with ARA or other employer of a like kind. Secondly, as is obvious, the exercise of estimating or assessing loss of earnings assumes something which did not occur, namely that a Certificate IV qualification was received by June 2015. It is, obviously on its face, an attempt to assess the sum of money lost to a person such as Mr Burnett, if all of the assumptions had fallen into place.

36. It is on that basis which the opinion may be expressed. The integers of the opinion are clear from the table provided by Mr Hunter as an appendix to his report. Whether or not the evidence establishes that all of those integers should be considered by the Court will be a matter for consideration at the end of the hearing. However, in my view, the opinion in paragraph 7.14 is admissible.

Conclusion

37. It follows that in my view, the two reports of Mr Hunter are admissible. The only limitation on the use of those reports is that paragraphs 7.10(b), (c) and (d) in the first report will be treated as assumptions rather than as establishing, by his expert opinion, any fact.

38. The first report of Mr Hunter with respect to Mr Burnett dated 28 October 2020 will be admitted and marked Exhibit P30, and the second or supplementary report of Mr Hunter, with respect to Mr Burnett, dated 13 January 2021, will be admitted and marked Exhibit P31.

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Decision last updated: 16 June 2023