Citibank Ltd v Liu; ABN Amro Bank Ltd v Liu

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

4660/99 CITIBANK LIMITED v CHIU WAH LIU (aka Tina Liu) & ORS 4662/99 ABN AMRO BANK NV v CHIU WAH LIU (aka Tina Liu) & ORS JUDGMENT 1 HIS HONOUR: These matters, which are for trial next week, are before me this morning for final pre trial directions. I am not at the moment quite clear whether an order has yet been made formally for the matters to be heard together. However, the parties have proceeded on the basis that they will be heard together and, if that order has not already been made, it will be made next week at the commencement of the trial. 2 This morning the second defendant has moved under Part 38 r 9(3) of the Supreme Court Rules 1970 ("the SCR") for orders giving him leave to use three of his own affidavits, being affidavits sworn on 24 and 30 November 1999 and 12 August 2002 on the trial, although he does not attend for cross examination. The plaintiffs do not consent to but do not oppose the making of that order, but ask that the following conditions be attached: "(a) No inference adverse to the Plaintiffs shall be drawn from the inability of the Plaintiffs, in the circumstances, to cross examine the Second Defendant upon his affidavits and in particular from the failure of the Plaintiffs to contradict any untested evidence of the Second Defendant.

(b) This order can be varied or rescinded by later order of the Court." 3 The circumstances in which this application is made are as follows. The second defendant is suffering from cancer, which is probably terminal. The evidence of this is contained in three exhibits previously tendered and marked Exhibits A1, A2 and A3. Essentially all of these are reports of Dr Nick Pavlakis FRACP of the Department of Oncology at the Royal North Shore Hospital. The dates of the three reports are, respectively, 14 March, 18 July and 7 August 2002. The diagnosis is primary inoperable liver cancer. He has been receiving chemotherapy administered using a procedure known as trans-arterial chemo-immobilisation. The prognosis is that inoperable cases such as the second defendant's are invariably fatal. The projected life span was stated as far back as March to be less than twelve months. In his latest report of 7 August 2002 Dr Pavlakis reiterated that the liver cancer was progressive and advanced. At that stage the second defendant's survival was stated to be measurable in months. He was said to be in reasonable physical condition, but it was stated that his health is susceptible to rapid decline. The doctor added: "It would be inhumane to put him through the emotional trauma of the Court proceedings you refer to. The impact on his physical health cannot be determined but deterioration is a possible outcome."

The "Court proceedings" referred to were "examination and cross-examination as a witness over a period of between one and four days." 4 Two things should be added. One is that, as I have already pointed out on more than one occasion, had the plaintiffs proceeded to trial with reasonable speed (the Court having always been willing to give an early trial date if the parties were ready), the trial would have occurred before the perceptible onset of the second defendant's illness. This is emphasised by the fact that the principal affidavits in respect of which the present application is made date back to November 1999. The other is that, despite Dr Pavlakis' firm, consistent and pessimistic prognosis, it is not entirely satisfactory that an up-to-date medical report from Dr Pavlakis is not tendered on the hearing of this application. However, the force of that absence is mitigated by the fact that the plaintiffs had a medical examination of the second defendant by a practitioner of their choice last week and this morning announced that they do not propose to lead any medical evidence on this application. 5 The principles on which such an application should be dealt with were discussed by the Court of Appeal in Clyne v Law Society of New South Wales NSWCA 17 August 1987 unreported. That case is also the source of the condition which the plaintiffs ask to have attached to the leave to use the affidavits. However, I am not inclined at the moment to impose condition (a) as sought. Evidence which, for whatever reason, however good, is not subject to cross examination when cross examination is required will always be discounted as appropriate if it is used by leave without cross examination. That will certainly be so in this case without any special direction. However, the degree to which it will be discounted may depend on a number of factors, including the circumstances which lead to cross examination being dispensed with, the nature of the evidence and the matter of whether it is central to the case or what the degree of its significance in the case is. The degree of discount appropriate will be judged according to all the circumstances of the case: Re O'Neil deceased [1972] VR 327 per Anderson J at 333 - 334. As to the second portion of the condition sought to be imposed, namely, that "no inference adverse to the Plaintiffs should be drawn from the failure of the Plaintiffs to contradict any uncontested evidence of the Second Defendant", I find it quite impossible to make a judgment concerning that matter and the degree to which any such inference should or should not be drawn without knowing more of what the relevant evidence is and the circumstances of the case generally. As I understood Mr Pembroke, of Senior Counsel for the plaintiffs, this morning, he cannot at this stage point to any evidence to which that condition may apply in this case, but asks for the condition in a precautionary way based upon what was done by the Court of Appeal in Clyne. 6 My view is this, at least at the moment. The plaintiffs may rely on, and the second defendant must face up to, the fact that the evidence will in any event be discounted to the appropriate extent by reason of the second defendant's absence. It is not necessary for a specific condition to be imposed to that effect. So far as the second leg of condition (a) is concerned, I cannot see at the present time what operation it may have and am not prepared to make an order attaching such a condition in those circumstances. However, the plaintiffs' position in my view should be protected. It will be adequately protected if I reserve to the plaintiffs liberty to apply to revoke the order granting leave, or for conditions to be attached thereto, up to the close of evidence. If there is occasion for that liberty to be exercised, it will be able to be exercised at a time when its incidence, if it is to be imposed, has become apparent. 7 As to the grant of the leave itself, although Dr Pavlakis' latest report is some six weeks old, it seems there is virtually no doubt on the evidence that the unfortunate second defendant is suffering from terminal liver cancer. There is no reason to doubt Dr Pavlakis' opinion that it would be inhumane to cross examine in the circumstances, and perhaps deleterious to his condition. Responsibility for the fact that the trial is occurring so far down the track of his decline is, in my view, in the plaintiffs' camp rather than the second defendant's. I am in the circumstances prepared to make an order granting leave. I shall not at present attach conditions but shall reserve the liberty to which I have referred. 8 The orders of the Court will therefore be: (1) I order that the second defendant be at liberty to use on the hearing of these proceedings his affidavits sworn 24 and 30 November 1999 and 12 August 2002. (2) I reserve to the plaintiffs liberty to apply to revoke this order or for conditions to be attached thereto up to the close of evidence.

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