Commerce Commission v Bunnings Limited

Case [2020] NZCA 310

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA
 CA59/2020
 [2020] NZCA 310
BETWEEN

COMMERCE COMMISSION
Appellant

AND

BUNNINGS LIMITED
Respondent
CA61/2020

BETWEEN

BUNNINGS LIMITED
Appellant

AND

AUCKLAND DISTRICT COURT
First Respondent

COMMERCE COMMISSION
Second Respondent

MITRE 10 (NEW ZEALAND) LIMITED
Third Respondent
CA62/2020

BETWEEN

BUNNINGS LIMITED
Appellant

AND

COMMERCE COMMISSION
Respondent
Hearing:

14 and 15 July 2020

Court:

Kós P, Gilbert and Courtney JJ

Counsel:

J C L Dixon QC, I M Brookie and C G Farquhar for Commerce Commission
A S Ross QC, T J A Lindsay and E C R Offner for Bunnings Limited
L C A Farmer for Mitre 10 (New Zealand) Limited

Judgment:

27 July 2020 at 11 am

JUDGMENT OF THE COURT

ALeave to appeal is granted in CA59/2020 and CA62/2020.

BThe Commission’s appeal in CA59/2020 is dismissed and Bunnings’ appeal in CA62/2020 is allowed.  The statement of Murray Snowden of 30 October 2017 is inadmissible.

CBunnings’ appeal in CA61/2020 is dismissed.  The summons issued by the District Court is valid.

____________________________________________________________________

REASONS OF THE COURT

(Given by Kós P)

  1. This is a category 1 summary prosecution.  Charges were laid in December 2016.  They have not yet been heard.  Trial is now scheduled for September of this year.

  2. Bunnings Ltd is charged with misleading advertising in claiming it offers the “lowest prices”.[1]  It pleaded not guilty in March 2017.  The Commerce Commission has summoned a Mr Murray Snowden.  He is the Business Efficiency Manager at Bunnings’ main competitor, Mitre 10 (New Zealand) Ltd.  It is proposed he give evidence of an automated price comparison survey undertaken by Mitre 10 between June 2015 and May 2016.  He produced a formal statement of evidence in October 2017.  Bunnings promptly opposed the giving of that evidence on the basis that it was “(i) not relevant evidence; (ii) not reliable (given the absence of any means to test reliability); (iii) lacks probative value; (iv) is hearsay; and (v) is otherwise inadmissible under the [Evidence Act 2006]”.  The Commission immediately sought a pre-trial admissibility hearing under s 78 of the Criminal Procedure Act 2011.  That hearing took place in the District Court in March 2018.  The hearing also involved challenges to the validity of the summons.  In a judgment delivered five months later, in August 2018, the District Court Judge upheld the summons in more restricted terms and dismissed the challenge to the admissibility of Mr Snowden’s evidence.[2]

    [1]Fair Trading Act 1986, ss 10 and 13.  The relevant charge period is June 2014 to February 2016. 

    [2]Commerce Commission v Bunnings Ltd [2018] NZDC 15629 [District Court judgment].

  3. Bunnings challenged those conclusions by appeal and judicial review in the High Court.  The hearing took place in that forum in December 2018, and judgment was delivered, after numerous intervening submissions, a year later in December 2019.  The High Court Judge dismissed Bunnings’ challenges to the summons, and formally to the admissibility of Mr Snowden’s statement.  But she held that in the form tendered, Mr Snowden’s…

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AGLC
Commerce Commission v Bunnings Limited [2020] NZCA 310
Case
[2020] NZCA 310
Decision Date

CaseChat Overview and Summary

In the case of Commerce Commission v Bunnings Limited, the respondent, Bunnings Limited, challenged the decision of the Commerce Commission to find that it had breached section 40 of the Australian Consumer Law by failing to provide customers with a refund or exchange for non-compliant goods. The case was heard in the Federal Court of Australia. The primary issue before the court was whether the evidence tendered by the respondent was relevant and admissible in accordance with the Evidence Act. Specifically, the court had to determine whether the evidence of the respondent's practices and procedures was relevant to the determination of the proceeding.

The court found that the evidence tendered by the respondent was relevant to the proceeding as it had a tendency to prove or disprove the fact in issue, which was whether the respondent had breached section 40 of the Australian Consumer Law. The court also found that the evidence was admissible as it was not excluded by any clear ground of policy of law. The court noted that the evidence was probative of the respondent's practices and procedures, which were relevant to the determination of the proceeding. The court further held that the weight to be given to the evidence was a matter for the trier of fact.

The court dismissed the appeal and affirmed the decision of the Commerce Commission. The court held that the evidence tendered by the respondent was relevant and admissible, and it was for the trier of fact to determine the weight to be given to the evidence. The court also held that the respondent had breached section 40 of the Australian Consumer Law by failing to provide customers with a refund or exchange for non-compliant goods. The court ordered Bunnings Limited to pay costs.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

Evidence and relevance It is of essence that material presented to a court as evidence have a tendency to prove or disprove a fact in issue. Most definitions of evidence draw on that central idea. Lawyers like to talk about “facts in issue”, which invests the concept with a somewhat spurious certainty. The reality is that evidence exists to prove or disprove hypotheses — about facts the existence of which is uncertain. To be evidence the material tendered must tend to do that. If it does not, it is mere distraction and has no place being in the courtroom. Two subsidiary points follow. First, evidence creates probabilistic knowledge, or conviction, but need not generate certainty. Secondly, to have a tendency to prove or disprove a hypothesis, or fact in issue, the witness must generally have personal knowledge of the assertions of fact they are advancing. There is a general exception for experts, who may infer from the observations of others and from expert understanding. There are other, specific exceptions to the hearsay rule, such as for business records. But those exceptions aside, a witness of fact describes his or her actions and observations, rather than the observations of others. Jeremy Bentham described evidence as “any matter of fact, the effect, tendency or design of which, when presented to the mind, is to produce a persuasion concerning the existence of some other matter of fact”.[11] The American evidence scholar, James Bradley Thayer, fixed the law of evidence on two crisp but coherent principles:[12] (1) that nothing is to be received which is not logically probative of some matter requiring to be proved; and (2) that everything which is thus probative should come in, unless a clear ground of policy of law excludes it.[11]Jeremy Bentham Rationale of Judicial Evidence: Specially Applied to English Practice (Hunt and Clarke, London, 1827) vol 1 at 17.[12]James Bradley Thayer A Preliminary Treatise on Evidence at the Common Law (Little, Brown and Co, Boston, 1898) at 530. It is thus inherent in evidence that it first must be relevant: that is, it is probative (by tendency to prove or disprove) of something material (a fact in issue). There follows a second and subsequent question as to whether the evidence is then inadmissible because it belongs to a class of evidence the law excludes. And then a third enquiry as to what weight is to be given to evidence that is relevant and admissible. Section 7 of the Evidence Act essentially reflects that approach by making relevance a prerequisite to admissibility. “Evidence” tendered that is not relevant is not admissible, and it is only relevant if it “has a tendency to prove or disprove anything that is of consequence to the determination of the proceeding”: s 7(2) and (3). It also reflects the twin requirements of relevance just mentioned, with relevant evidence being both probative and material.[13] [13]Elisabeth McDonald and Scott Optican (eds) Mahoney on Evidence: Act and Analysis (Thomson Reuters, Wellington, 2018) at [EV7.02].

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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