Tyler v Thomas

[2006] HCATrans 477

[2006] HCATrans 477

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S72 of 2006

B e t w e e n -

MICHAEL TYLER

Applicant

and

GAVIN THOMAS

Respondent

Application for special leave to appeal

CALLINAN J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 1 SEPTEMBER 2006, AT 2.39 PM

Copyright in the High Court of Australia

MR R.J. DOUGLAS, SC:   May it please the Court, I appear with MR A.D. CROSSLAND for the applicant.  (instructed by Purcell Insolvency Lawyers)

MR N.A. COTMAN, SC:   May it please the Court, I appear with MS N.C. BEARUP for the respondent.  (instructed by The Argyle Partnership)

CALLINAN J:   Yes.  Mr Douglas.

MR DOUGLAS:   Your Hours, the matter we submit for this Court’s disposition on appeal concerns charting the procedural metes and bounds of one of the tools of modern case management, namely the appointment of a court expert witness.  The decision of the Full Court of the Federal Court, we submit by way of summary, provides, in the absence of it being disturbed, significant encouragement, indeed, concomitantly little impediment, to a trial judge at trial in any jurisdiction where such a jurisdiction exists to appointing such an expert and doing so as an alternative to ruling upon objections to and assessing the weight of expert evidence which is proffered by the parties.

We submit, your Honours, that the features of this present dispute ordain it as a suitable vehicle for appellate disposition.  If we may, could we just mention eight reasons why that is so.  The first reason – it is an overarching reason – is that this same jurisdiction which was enjoyed and exercised by a Federal Magistrate exists across the gambit of jurisdiction in this country.  From this Court, the High Court, right through to the various Magistrates Courts the terms are not exactly the same but analogues exist widely and ubiquitously nonetheless.

The second point we make as to it being a suitable vehicle, your Honours, is that this case before his Honour at first instance was the subject of pre‑trial case management.  Directions were given with respect to the exchange of evidence by way of affidavit and those directions were taken up by the parties, complied with by the parties and expert evidence was delivered.  It was certainly delivered by the respondent to this appeal, the Trustee in Bankruptcy.

CALLINAN J:   Mr Douglas, did the Full Court really purport to lay down a very general rule which would open the door, as it were, to the appointment, indiscriminately, as it were, of court appointed experts?  Now, I ask you that because of paragraph 43 on page 55 of the application book.  I know the court is talking about appointment after the commencement of a hearing.  That is what happened here, is it not?

MR DOUGLAS:   It did.  If we could answer your Honours this way and directly, Justice Branson earlier in her reasons at page 51 of the record after analysing the case law on the subject did predicate six principles which she elicited from the decided jurisprudence and one of those at line 21 on page 51 of the application book was:

ordinarily the appropriate time for the exercise of the power is well before trial so that the parties have adequate time to give consideration to the report of the court expert and to make decisions on whether they wish to challenge any part of that report –

Your Honours, we do not cavil with that, indeed, we underscore it.  We submit that it emanates insensibly from the jurisprudence.

CALLINAN J:   Accepting all of that but focusing on the present case, the Full Court has said it is rare that this particular situation will be permitted or ought to be permitted to occur.

MR DOUGLAS:   Your Honour is quite right when you say that because her Honour says that, of course, at page 55, as your Honour told us, at line 25, but notwithstanding that we say that is really a non sequitur comment ‑ ‑ ‑

CALLINAN J:   But it demonstrates, Mr Douglas, that at this level you have a rare case and its recurrence, one might think, is unlikely.  I might say so far as I am concerned, I think in general judges ought to sit down and hear cases and hear the evidence and perhaps there is too much intervention in some jurisdictions on some occasions, but be that as it may this is a rare case.

MR DOUGLAS:   Your Honour, we would submit it is a rare case in terms of the ultimate decision that was made but it is not a rare case if one looks at its character.  There was nothing rare about this case at all and that is why we characterise her Honour’s comment as really being non sequitur because when you look at it, it was a trial, case managed involving an issue which was always an issue between the parties, namely the valuation of this land for the purposes of the operation of that fact in relation to section 120 of the Bankruptcy Act.  It was a matter upon which expert evidence was proffered by the moving party, namely the Trustee in Bankruptcy. 

It went to a hearing and then, and only then, when the expert evidence was challenged, that is the Trustee’s expert evidence was challenged, that the Federal Magistrate made the decision which he did.  There was nothing special about the case. There was nothing rare about the case.  We accept that Justice Branson says it is a rare result but this was not a rare case.

CALLINAN J:   There were some rare aspects to it.  There was a transfer by one relative to another close relative, was it not?  An uncle to a nephew, was it?

MR DOUGLAS:   It was to a nephew but, with respect ‑ ‑ ‑

CALLINAN J:   There were other aspects of the transaction that looked, let us put it this way, suspicious.

MR DOUGLAS:   Your Honour, I accept that characterisation of it but that was not a matter, we submit, which had any bearing whatsoever upon the decision which the Magistrate made.  One area in respect of which there was a majority in favour of the applicant in the Full Court of the Federal Court as between Justice Bennett on the one hand and Justice Branson was in relation to this public interest issue insofar as concerned the creditors. 

I mention that because it may well be that which perhaps your Honour is taking me, in a sense, obliquely, and there can be no doubt on the face of the judgment of Justice Branson on the page just anterior to that which the Court took us a moment ago at page 54, at lines 21 to 34, that Justice Branson’s view, we would submit, was consonant with that expressed by Justice Bennett at page 69, lines 40 to 49, respectively, that the learned Magistrate, the learned trial judge, was quite in error in adopting that approach.  Indeed, contrary, we would submit, to what Justice Branson and Justice Graham found, from the reasons of the trial judge that was the – and express it how one will, we would submit the salient consideration which led the Magistrate, the trial judge, to make the decision which he did. 

That that appears to be so is to be found at page 5 of the application book commencing at line 36.  It appears elsewhere in the judgments, of course.  “My main concern when considering the question of appointment” – I will not read it out or rehearse it to your Honours.  Our submission is this, that this is another reason why we submit that this Court should grant special leave because your Honour has put to us that it is a rare case.  We submit that that is not right if one looks at the true character of this particular matter, but there is also an encouragement to judges across the plethora of jurisdictions where this particular appointment power or jurisdiction exists to found their decision upon the interests of non‑parties.  We would submit that is another reason why this Court ought ‑ ‑ ‑

CALLINAN J:   It is a discretionary decision, to some extent, though, is it not?

MR DOUGLAS:   It is undoubtedly discretionary territory.

CALLINAN J:   It does not matter what I might think of the rule or the fact that courts may do this.  It does not matter at all.  In fact, the power is there.  The discretionary power is there.  I might or might not think it should ever have been there, but that is not the point, Mr Douglas.

MR DOUGLAS:   It is not the point but if that discretion, of course – I am sorry to be trite about it, but if that discretion is exercised in such a fashion as to be in error in the make up of the final decision, then we would submit that it ought to be disturbed on appeal.  This is the vice, we would submit, in the approach adopted by the majority in the Full Court.  Again – and one can conveniently do it by reference to the judgment of Justice Branson again at those critical pages, 54 and 55, of the record.

Her Honour, after dealing with the public interest issue to which we took you a moment ago at the middle of page 54 then goes on to recite a number of other alternatives that might or would be offensive in terms of the exercise of the discretion if, as your Honour sees in the second line and the fourth‑last line, that the Magistrate “was principally motivated” or had a principal purpose in doing what he did.  We would submit then, going over to the next page from the base of page 54, that her Honour correctly observes that various observations by the trial judge did indicate that he was motivated by some of those improper considerations, but then it is said, moving down that page 55 to about line 16 to the base of that paragraph, her Honour says it would appear ultimately he was motivated or moved to act as he did because he believed that the appointment of the expert would facilitate settlement or shorten the proceedings.  We would submit that it is an erroneous approach to examining the proper or improper exercise of discretion.

CALLINAN J:   We are concerned with matters of principle here, as you would understand.

MR DOUGLAS:   Of course, yes, we accept that.

CALLINAN J:   It is very difficult to read Justice Branson’s reasons as any encouragement for the recurrence of what happened here in the future, I would have thought, if you read the whole of the reasons.

MR DOUGLAS:   Your Honour, the essence of our point is essentially this.  This was as pedestrian a case as one could have in terms of a case managed case for the disposition of an issue which was always an issue from the cusp of the commencement of the proceedings and if a court‑appointed expert is to be ordered in this case at a trial with all the disadvantages and for all the adverse procedural reasons which Justice Branson identifies in her reasons for judgment on examining principle as apt in this case, then it really is apt in any case.  To say that it is

rare really would only invite the submission in another place, that is, before another trial judge, “Well, this is no different from that case, your Honour, hearing this matter at first instance.  It was a pedestrian case there, this is a fairly pedestrian case, that you have a broad discretion.”

We would submit that more needs to be done rather than allowing the Full Court in this case to merely remark that it is a rare case, at least from one of the judges who decided the matter as part of the majority, and, with respect, your Honour Justice Callinan, really, for anyone who happens to be reading the transcript of this application for special leave to act in such a manner that the impediment does exist to a trial judge acting similarly.

CALLINAN J:   Well, let me put it on record, it is not a course I would encourage, Mr Douglas.

MR DOUGLAS:   That helps.  It does.

CALLINAN J:   Thank you.

MR DOUGLAS:   It does.  I mean that respectfully.  Your Honours, we were going through the various issues why we submitted that this was a proper vehicle.  I think it is correct to say that those particular matters are matters which we have canvassed in the exchanges we have had with your Honour in the last five or 10 minutes in any event.  In our respectful submission, this is a case which does involve issues which are part of the new wave of procedural disposition of litigation, namely managed litigation, and we would submit that it is as well that these sorts of issues are sorted out at the base level, so to speak, otherwise the many, many trials that are going on throughout this country on a day‑to‑day basis may well be disrupted by decisions like this, and we submit it is a disruptive decision in relation to procedural disposition affecting many cases.  I do not think we can assist you any further, your Honours.

CALLINAN J:   Thank you, Mr Douglas.  There is no need for us to trouble you, Mr Cotman.  This case depends very much upon its own facts.  It is a rare case in many respects.  In any event, we think that there are insufficient prospects of success and for that reason we will dismiss the application for special leave with costs.

MR DOUGLAS:   If the Court pleases.

CALLINAN J:   Yes, thank you.  Adjourn the Court, please, until 10.15 am on Tuesday, 5 September in Canberra.

AT 2.55 PM THE MATTER WAS CONCLUDED