Lewis Holdings Limited v Steel & Tube Holdings Limited

[2014] NZHC 2650

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2013-485-6104 [2014] NZHC 2650

UNDER

Part 18 of the High Court Rules

IN THE MATTER

of ss 271(1)(a) and 272(1) of the
Companies Act 1993

BETWEEN

LEWIS HOLDINGS LIMITED First plaintiff

BORIS VAN DELDEN and PERI MICAELA FINNIGAN

Second plaintiff

AND

STEEL & TUBE HOLDINGS LIMITED Defendant

Hearing:	20-24 October 2014
Counsel:	K J Crossland and J S Langston for Plaintiffs S A Barker and P J Niven for Defendant
Judgment:	28 October 2014

INTERLOCUTORY JUDGMENT OF MACKENZIE J (Expert witness' calculations and workings)

I direct that the delivery time of this judgment is

4.40 pm on the 28th day of October 2014.

Solicitors:           Shieff Angland, Auckland, for Plaintiffs.

Buddle Findlay, Wellington, for Defendant.

LEWIS HOLDINGS LTD v STEEL & TUBE HOLDINGS LTD [2014] NZHC 2650 [28 October 2014]

[1]      The defendant intends to rely on the evidence of Mr Colcord, a registered valuer,  to  give  expert  evidence  for  the  defendant.    Mr Colcord  has  sworn  two affidavits, and has been required for cross-examination on those affidavits.   In his first affidavit, Mr Colcord relies upon, and produces as an exhibit, a spreadsheet which he has used in making his assessment of value and expressing his opinion. Mr Crossland asked for what he described as a “native copy” of that spreadsheet.

[2]      Mr Barker referred this request to Mr Colcord.   Mr Colcord has refused to make this information available.   He says that it contains confidential information and intellectual property belonging to his firm.   He says he would be put to professional detriment if that information is released, especially to the plaintiffs’ valuer,  Mr Smithies,  who  is  a  competitor,  which  could  not  be  protected  by  an undertaking.  Mr Colcord also expresses the view that his underlying workings are irrelevant to the consideration of his conclusions and figures.

[3]      Mr Crossland applies for an order directing that Mr Colcord make available the requested information.  Mr Barker opposes that application.  This judgment rules on that application.

[4]      In giving evidence, an expert witness must comply with the Code of Conduct for Expert Witnesses in sch 4 for the High Court Rules.   Under paragraph 3, the evidence must :

(d)       state the facts and assumptions on which the opinions of the expert witness are based:

…

(f)       specify any literature or other material used or relied on in support of the opinions expressed by the expert witness:

(g)       describe any examinations, tests, or other investigations on which the expert witness has relied and identify, and give details of the qualifications of, any person who carried them out.

[5]      A spreadsheet is a means of performing calculations.  In the form in which that spreadsheet is displayed, as annexed to Mr Colcord’s affidavit, only the results of the calculations performed within the spreadsheet are shown.  The way in which the calculations have been performed, in terms of the formulae used to produce the

answers displayed in the spreadsheet, are not disclosed.   I cannot accept without examination Mr Colcord’s view that the underlying workings in the spreadsheet are irrelevant.  It appears to me that their disclosure may well be necessary to comply with Mr Colcord’s duties as an independent expert witness.

[6]      Because Mr Colcord may not have appreciated that the disclosure of the information may have been necessary to comply with his duties as an expert witness, I am reluctant to order the disclosure applied for by the plaintiffs.  On the other hand, I am not prepared to admit the spreadsheet itself in evidence, without the disclosure of the way in which the calculations in the spreadsheet have been performed.   I suggested at the hearing a possible means of addressing that dilemma.   Neither counsel expressed particular objection to that course and I have now decided, on further reflection, to adopt it.

[7]      I direct that, unless Mr Colcord is prepared to disclose a “native copy” of his spreadsheet, in a form which enables counsel for the plaintiffs and Mr Smithies access to the formulae used in calculations in the spreadsheet and any other information  contained  in  it,  Mr Colcord’s  spreadsheet  will  not  be  admitted  into evidence.  He will not be permitted in giving his evidence to express any opinions which are based upon that spreadsheet.

[8]      To  the  extent  that  Mr Colcord’s  evidence,  without  the  spreadsheet,  and restricted in the way I described, does not comply with his duties as an expert witness, particularly as set out in [4] above, Mr Colcord may file a supplementary brief, directed only to the part of his evidence which relies upon the spreadsheet. The supplementary brief must be limited to that issue.  I do not grant leave to file any additional evidence going beyond that limited aspect.

[9]      Counsel for the defendant may accordingly file, by 7 November 2014, either:

(a)      a memorandum advising that the material requested by the plaintiff has been supplied to the plaintiff, on confidentiality terms requiring its being kept confidential to counsel for the plaintiffs and Mr Smithies; or

(b)a further affidavit from Mr Colcord setting out, in a form which does not require reference to the spreadsheet and which complies with his duties as an expert witness, the basis for such of his evidence as presently relies upon that spreadsheet.

[10]     If neither of those steps is taken, Mr Colcord’s first affidavit will be read

excluding any parts of it which are based on the spreadsheet.

[11]     For the avoidance of doubt, I direct that, if the spreadsheet is excluded, it will, as a previously produced document, be available to counsel for the plaintiffs to use in cross-examination of Mr Colcord.  Any claim for confidentiality in respect of answers to questions which may be put in cross-examination will be addressed at the hearing.

“A D MacKenzie J”