Dyldam Developments Pty Limited v Jones

Civil Liabilities Act 2002 s 13 LEGISLATION CITED: Evidence Act 1995 (NSW) s 135 Workplace Injury Management and Workers Compensation Act (s 318(1)(d))

Ainsworth v Burden [2005] NSWCA 174 Andrews v Nominal Defendant (1963) SR(NSW) 110 Bakerland Pty Ltd v Coleridge [2002] NSWCA 30 Barrett Property Group Pty Ltd v Metricon Homes Pty Ltd [2007] FCA 1509 CDJ v VAJ [1998] HCA 67 and 76; 197 CLR 172 Clark [2001] NSWCCA 494; 123 A Crim R 506 Commonwealth of Australia v McLean (1997) 41 NSWLR 389 CASES CITED: Driscoll v The Queen (1977) 137 CLR 517 Giorginis v Kastrati (1988) 49 SASR 371 House v The King (1936) 55 CLR 499 Ordukaya v Hicks [2000] NSWCA 180 Papakosmas v The Queen [1999] HCA 37; 196 CLR 297 R v Suteski [2002] NSWCCA 509; 56 NSWLR 182 Suvaal v Cessnock City Council [2003] HCA 41; (2003) 200 ALR 1; 77 ALJR 1449 Warren v Coombes (1979) 142 CLR 531

DYLDAM DEVELOPMENTS PTY LIMITED (Appellant) PARTIES: Warren JONES (First Respondent) SAMORTO 13 PTY LIMITED (in liquidation) (Second Respondent)

COUNSEL: J GRAVES SC (Appellant) S NORTON SC/ J de GREENLAW (First Respondent) L KING SC/ M J JENKINS (Second Respondent)

Hicksons (Appellant) SOLICITORS: Bale Boshev Lawyers (First Respondent) Home Wilkinson Lowry (Second Respondent)

LOWER COURT JURISDICTION: Supreme Court - Common Law Division

LOWER COURT MEDIUM NEUTRAL CITATION: Jones v Dyldam Developments Pty Ltd & Anor [2007] NSWSC 752

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40531/07 SC 20355/06

GILES JA HODGSON JA BASTEN JA

8 APRIL 2008 DYLDAM DEVELOPMENTS PTY LIMITED v Warren JONES and Anor Judgment 1 GILES JA: I agree with Hodgson JA. 2 HODGSON JA: On 31 July 2007, orders were made pursuant to reasons for judgment given by Simpson J on 13 July 2007, which decided proceedings in which the first respondent (the plaintiff) had claimed damages for personal injury against the appellant (Dyldam) and the second respondent (Bricklaying), and in which each defendant had put on a cross-claim against the other claiming contribution or indemnity in respect of any liability found against it. 3 Those orders included a judgment for the plaintiff against Dyldam in the sum of $2,642,095, judgment for the plaintiff against Bricklaying in the sum of $967,607, judgment for Dyldam against Bricklaying in the sum of $241,901.75, and judgment for Bricklaying against Dyldam in the sum of $725,705.25. There were also orders that Dyldam pay 75 per cent of the plaintiff's costs of the proceedings, and that Bricklaying pay 25 per cent of the plaintiff's costs of the proceedings. Agreements relating to compensation already paid to the plaintiff were noted. 4 Dyldam has appealed against the judgments against it. Bricklaying has put on a cross-appeal against the judgments against it. 5 The question was raised as to whether it was permissible for Bricklaying in a cross-appeal to challenge a judgment against it in favour of the plaintiff, who was not an appellant. Bricklaying was the respondent to an appeal from the primary judge's decision, and wished to cross-appeal from the whole or parts of that decision, so (unless "decision" is narrowly construed as being the particular orders challenged in the original appeal, which would seem an untenable construction) it would seem that the cross-appeal was in order (Supreme Court Rules 51.18: cf UCPR 51.17). However, the point was not pursued, so it is not necessary to express a final view. 6 The appeal and cross-appeal raise four broad issues: (1) Whether, on the evidence admitted before her, the primary judge's decision that the plaintiff's injury was caused by negligence of Dyldam and Bricklaying was vitiated by errors in her reasons; (2) Whether the primary judge erred in rejecting certain evidence tendered by Dyldam; (3) Whether the primary judge erred in her apportionment of responsibility as between Dyldam and Bricklaying; and (4) Whether the primary judge erred in her determination of economic loss. 7 I will deal with these issues in turn.

Finding on liability 8 In his Further Amended Statement of Claim, the plaintiff alleged that he was employed by Bricklaying as a labourer (para 6); that Bricklaying was carrying out building work at 12-14 Connie Avenue, Baulkham Hills (the site) as a subcontractor to Dyldam (para 7); that Dyldam was carrying on building work at the site (para 8); that on 20 February 2003, the plaintiff was required to carry out work, using a wheelbarrow, to transport wet cement from one part of the site to another (para 9); and that whilst he was undertaking this work he lost control of the wheelbarrow and as a result suffered injury (para 10). The plaintiff also alleged that, at the time he was carrying out this work, work was being carried out by a bobcat driver (para 11), for whose conduct Dyldam was vicariously liable (para 12); and the bobcat driver caused the ground over which the plaintiff worked to be churned up, as a result of which the plaintiff lost control of the wheelbarrow and was injured (para 15). 9 The plaintiff gave evidence at the trial that his job at the site involved wheeling a large wheelbarrow with mortar over a distance of 150-200 metres to bricklayers, over various surfaces, having to work fast because of a shortage of labourers. On the day of his accident, he started work about 7 am, and there were two bobcats on the site. These bobcats were taking dirt from where a truck was dropping it, and filling a gap near the building; and they churned up the ground over which the plaintiff had to wheel the wheelbarrow, causing humps and bumps and dips. The plaintiff's wheelbarrow went into a dip, jerking him forward and he felt a massive pain in his lower back. He ended up lying flat on his back on the ground. 10 The plaintiff said he laid on the ground for about half an hour. When he could walk, he went to see Arazio, one of the people who ran Bricklaying (along with his son and his nephew), who said to go home. When the plaintiff was able to drive his car, about half an hour later, he went to the medical centre near where he lived at Glenwood. There he saw Dr Mihrshahi, who gave him a medical certificate and a referral for an x-ray. 11 The plaintiff said he went back to the site the next day, and first saw Arazio, who would not take the medical certificate from him. Arazio's nephew Salvatore came in after that, and he took the medical certificate. The plaintiff said he was told that Bricklaying would continue paying his wages; and he was advised not to make a workers compensation claim, but to get back to work as soon as possible. 12 The plaintiff gave evidence to the effect that later, when he realized he had a serious injury, and was not going to recover quickly, he filled out a workers compensation claim form. 13 Other oral evidence relevant to the question of liability was given by Trevor Chia, Heath Fayad and Anthony Grasso. 14 Trevor Chia gave evidence that in February 2003 he was employed by Dyldam as the leading hand on the project at 12-14 Connie Avenue; that he helped in the organisation of subcontractors including Bricklaying, dealing with Sebastian Grasso, Salvatore Arazio and/or Tony; that he would discuss a track or walkway for them; that "we would make sure it was a safe walking area"; that the protocol was that accidents on the site would be reported to him; that a flood had destroyed a large amount of Dyldam's records; and that he knew the plaintiff and remembered that there was a time when the plaintiff stopped coming to work, but that he was not told the plaintiff was off work on compensation having been injured. 15 Heath Fayad's evidence concerned the second issue, to which I will return. 16 Anthony Grasso gave evidence that until the liquidation of Bricklaying, he had been a director; that he had arranged for the payment of remuneration to the plaintiff; that he found out from a telephone call from the plaintiff that the plaintiff had an injury at work; that he continued to pay the plaintiff until it was realised the plaintiff wasn't coming back, when it went through workers' compensation; that his father Arazio had had a stroke and lost his memory; and that Bricklaying's records could not be found. 17 There were in evidence before the primary judge some significant documents relevant to the date and circumstances of the injury. 18 There were handwritten notes by Dr Mihrshahi dated 20 February 2003, this date being confirmed by a daily schedule which was also in evidence: "LBP [low back pain] since morning 11-AM started at work when pushing wheel barrow full bricks. says in terrible pain

A note in the margin reads: "pt [patient] says this is not w/c [workers compensation]" 19 There was an x-ray report dated 22 February 2003, which did not disclose the injuries to the plaintiff's back. There was also a report of a CT scan dated 13 March 2003, which is as follows: There is a clinical history of back pain after a fall, about 3 weeks ago.

At L5-S1 there is a left posterior prolapse of the disc which extends prominently into the lateral recess and is a likely cause of irritation of emerging S1 nerve root.

There is a healing fracture of the left transverse process of L3.

Comment : A disc prolapse and a small fracture as above.

Clinical review for any evidence of injury to the left kidney and spleen is suggested.

An abdominal ultrasound could provide further details. 20 There was a WorkCover NSW Medical Certificate from the plaintiff's usual GP, Dr Huynh, which certified that the plaintiff was unfit for work from 13 February 2003 to 13 April 2003, and referred to an examination taking place on 6 March 2003. The date this certificate was prepared is unclear. Since it refers to a fracture of the L3 vertebra, it must have been completed after the CT scan on 13 March 2003, because it was only by that CT scan that the fracture was disclosed. The plaintiff's signature to the document confirms correctness of the information contained on it and is dated 15 May 2003. However, Dr Huynh's signature appears to be dated 6 March 2003. This document gives the date of injury as 12 February 2003, and gives the following description of how the injury occurred: "Fell at work onto back when wheelbarrowed bricks". 21 There was a workers compensation claim form signed by the plaintiff on 12 May 2003, giving the date of injury as 12 February 2003. There were also other documents relevant to compensation signed by the plaintiff towards the end of May 2003, which gave the date of injury as 1 February 2003. 22 There was a statement made on 1 March 2006, pursuant to the Workplace Injury Management and Workers Compensation Act (s 318(1)(d)), in which the plaintiff gave the following description of how he suffered his injury: 20 From the first trip it became apparent it was going to be difficult to keep the required amount of mud up to the 2 bricklayers lining the pit. It was difficult to find a path for the wheelbarrow, over the uneven ground, up and down the inclines and over, through or around the building debris strewn on the ground and various other obstacles in the path from the mixer to the pit. The operator of the mixer, Dominic, always filled any wheelbarrow with as much mud as the wheelbarrow could take and during these trips the wheelbarrow was filled to the brim. I was able to complete 2 trips without incident, although it was difficult and tiring.

21 As I was walking back to the mixer from the pit a bobcat which had been working towards the front of the site up to that time began operating down the side of the site, and around the back of the building, closer to and past the pit.

22 On my third trip from the cement mixer to the pit, with the wheelbarrow filled to the brim with mud, after traversing about 150 metres, I had to walk down a decline. It was in this area that the bobcat had recently been working and the ground was now churned up. There was also building material, debris and other obstacles lying on the very uneven ground. Trying to find a path to the pit, particularly with the wheelbarrow so full, was difficult in view of the building material and debris strewn on the ground. During the course of this, whilst trying to push to the wheelbarrow past all these obstacles, one of my feet was caught in the uneven ground, created by the bobcat churning it up, and this caused me to lose my balance. I continued to hold onto the wheelbarrow but the weight was such that it eventually toppled over and some of the mud spilled out onto the ground. 23 There was in evidence a letter from a radiologist, Dr Shnier, dated 3 May 2003, which reviewed the x-ray of 22 February 2003 and the CT scan of 13 March 2003, and concluded with the following expression of opinion: 3. The CT scan was taken within two weeks of the alleged fall on the 20th February. The degree of maturity of healing of a fracture means the injury of the transverse process had to precede the 20th of February the date of the alleged fall as the appearance of the callus takes closer to 5-6 weeks to develop this appearance. This is supported by the suggestion of sclerosis seen on the lumbar spine XRAY that is caused by the bony callus. Therefore the fracture had to pre-exist the fall. 24 The primary judge gave the following reasons for finding the plaintiff suffered injury in the circumstances described by him: [23] The plaintiff was extensively cross-examined on the variations discernible in his accounts of his injury given in the various documents extracted above. Attention was drawn, both in cross-examination and in subsequent address, to the description of the plaintiff's work as barrowing bricks (not mortar, cement or mud), and, particularly, to the absence in Dr Mihrshahi's note, of a fall, or indeed, any causative incident. Dr Mihrshahi's note merely records the onset of "terrible" back pain while pushing a barrow load of bricks. Likewise, the plaintiff was cross-examined at length concerning the date which he had given to various people of his injury.

[24] There is, I accept, some mystery about the date. Dr Mihrshahi's record, taken together with the plaintiff's evidence that he attended her on the day of his injury, would support the present pleading that the injury occurred on 20 February 2003. However the note includes a reference to the plaintiff's inability to sleep on his back. This would not suggest that that attendance was on the day the injury was sustained. On the other hand, there is no earlier note in Dr Mihrshahi's records that would permit an inference that the injury occurred on an earlier date.

[25] I am satisfied that this anomaly does not have to be resolved. The plaintiff's evidence was that he did not make any attempt to identify the date until asked to do so some time later. Then, his impression was that it had occurred during the first two weeks of February. It was only by a process of deduction on the part of the plaintiff's solicitors, principally by reference to Dr Mihrshahi's note, that the date of 20 February was fixed upon. But there is no dispute that the plaintiff worked on the site; it was never suggested to him that his description of the terrain was other than accurate; and it was common ground that, from time to time, bobcats worked on the site.

[26] I am conscious, also, that Dyldam, especially, places considerable store on the date of 20 February. This is because of an opinion expressed by Dr Ronald Shnier, a radiologist who, in May 2007, reviewed various radiological examinations of the plaintiff, and concluded that a CT scan taken on 13 March provided evidence that the injury that it disclosed pre-dated 20 February, and was of closer to 5-6 weeks' maturity - that is, having occurred at the end of January or early February. But Dr Shnier was under the mistaken impression that the CT scan was taken only two, not three, weeks after the date on which he said he was injured.

[27] The acknowledged fact is that the plaintiff never returned to work after the incident that caused his injury. In the ordinary course the date would be readily ascertainable by reference to wage records of his employer, Sydney Bricklaying. However, for some time after he ceased work, and until he made a claim for workers' compensation in May 2003, Sydney Bricklaying continued to pay him in the ordinary manner. And, in any event, Sydney Bricklaying has gone into liquidation and many of its records have been lost. Such records as do exist therefore do not clarify the position.

[28] The plaintiff's credibility is not affected by the mystery surrounding the date of his injury. He has committed himself to the date of 20 February only on the basis of information supplied to him by his solicitors. He did not pretend to have any independent recollection that his injury occurred on that date. In my opinion the evidence concerning the date raised a false issue which need no longer be pursued.

[29] On behalf of Dyldam one witness gave evidence. He was Trevor Chia, who, in early 2003 was employed by Dyldam as a leading hand. Mr Chia described the arrangements for organising work on the building site. However, it does not appear to me that, in any material respect, this evidence advances the issues with which I am presently concerned. It casts some light on the issues raised by the cross-claims.

[30] Counsel for both defendants put submissions to the effect that I would not accept that the plaintiff's injury occurred as described by him. I have already outlined the basis on which that submission was put on behalf of Dyldam; the attack on behalf of Sydney Bricklaying was not significantly different. I reject both attacks. As I have stated, I found the plaintiff to be an honest witness and, while there were some inconsistencies, even in his oral evidence, I am comfortably satisfied that these arose because of faulty understanding of what he was being asked, or faulty recollection. In passing, I note (as will shortly become apparent) that it was common ground that the plaintiff's current medical condition is dire, that he experiences considerable and constant pain and discomfort, and that his physical condition has had a significant effect upon his emotional condition. The plaintiff was, at times, agitated; he frequently lost concentration, and he showed clear signs of not coping well with cross-examination or even examination in chief. That, however, was not because of any lack of integrity on his part. It was for the reasons I have given. His physical pain was readily observable, as was, frequently, his emotional pain.

[31] Notwithstanding discrepancies, and notwithstanding a question mark as to when the injury occurred, I am quite satisfied that it occurred substantially as described by the plaintiff.

[32] The negligence alleged against each defendant was particularised at great length and in great detail.

[33] I am satisfied that the plaintiff has made out his case in negligence against each defendant. As against Dyldam, it is clear that the site on which the plaintiff was required to work was unsafe by reason of the ground surface. In this respect, I note Mr Chia's evidence that it was his practice to meet, on site, senior representatives of Sydney Bricklaying to map out the day's work; this included plotting access ways to locations where labourers or tradesmen had to work. He said that crushed concrete was used to produce a "safe walking area". But Mr Chia was not asked to, and did not, challenge the plaintiff's description of the general ground surface. And he did not suggest that labourers, such as the plaintiff, were routinely advised by Dyldam of what was agreed between the managers. It is not, in my opinion, of major consequence whether the particular disturbance in the terrain into which the plaintiff's wheelbarrow was caught was caused by a bobcat or by some other means. I interpolate that, on the balance of probabilities, I accept that it was so caused; but, even if there were some other cause, it was quite plain that the ground surface was uneven, was littered with rubble, crushed concrete, building materials and debris; it was, in places, wet, and was quite unsuitable for the use of a wheelbarrow, particularly one laden to the brim with wet concrete.

[34] It follows that, so far as the plaintiff is concerned, Sydney Bricklaying was also in breach of its duty of care to provide the plaintiff with a safe place to work and with safe working conditions. Such a duty is, of course, non-delegable, and it was not suggested that Sydney Bricklaying had delegated this duty to Dyldam or anybody else. There was no evidence that Sydney Bricklaying had taken any steps to ensure that the plaintiff was provided with a safe working environment. There was no evidence that Sydney Bricklaying kept labourers, such as the plaintiff, informed of the agreed access ways. It is apposite to note that a director of Sydney Bricklaying was called, but gave no evidence capable of exculpating the plaintiff's employer. 25 Mr Graves SC for Dyldam submitted that the primary judge's reasons disclosed error, in particular in her holding that she did not have to resolve anomalies concerning the date of the accident and that evidence concerning the date raised a false issue; and in holding to the effect that it was not of major consequence whether the particular disturbance that brought the plaintiff undone was caused by a bobcat. He also submitted that the primary judge did not give adequate reasons for accepting the plaintiff's evidence, in the face of the various problems with it. 26 Mr Graves submitted that unless the plaintiff established that his injury occurred on 20 February 2003, he had not established the case pleaded in the statement of claim which Dyldam came to meet: see Suvaal v Cessnock City Council [2003] HCA 41; (2003) 200 ALR 1; 77 ALJR 1449. Mr Graves submitted that, if Dyldam had sought to lead evidence on what happened on the site on days other than 20 February 2003, it would have been rejected as irrelevant. 27 Next, Mr Graves submitted that Dr Shnier's opinion showed that the plaintiff's injury could not have occurred on 20 February 2003, and that the primary judge misconstrued this opinion so as to negative its effect. 28 Mr Graves also submitted that the plaintiff's evidence inseparably tied the operation of a bobcat to the cause of the disturbance which caused his injury to occur, and it was crucial to the plaintiff's case against Dyldam that the primary judge accepted this account. It was also of crucial importance on the question of apportionment. 29 Mr King SC for Bricklaying adopted Mr Graves' submissions. 30 In my opinion, the challenge to the primary judge's reasons is not made out. 31 In the circumstances of this case, it would have been open to the primary judge to find that the plaintiff was injured on a day earlier in February than 20 February 2003, provided she was satisfied that natural justice had been afforded to the defendants. It is no longer the case that pleadings rigidly and precisely limit issues. They must appropriately give notice of the claims being made, and must plead matters that would otherwise take a defendant by surprise. They govern what evidence is admissible; and it would not be open for a judge to uphold a claim that is outside the pleadings in the sense of being outside of claims of which the pleadings give notice, at least unless the course of the trial made this permissible. In my opinion, the crucial consideration is whether the claim being upheld by the judge is one of which the losing party had appropriate notice and an appropriate opportunity to meet by evidence and submissions. 32 In my opinion, these views are consistent with Suvaal; and, in particular, are consistent with what was said in para [36] of the judgment in that case: [36] A trier of fact, confronted with divergent cases being advanced by the parties, may decline to accept either case and may proceed to make findings not exactly representing what either party said. But that does not justify the creation of an entirely new case with which the losing party had no testimonial or other evidentiary opportunity to deal. 33 In the present case, Dyldam must have been aware of the possibility that the judge might have found that the plaintiff's accident occurred on a day earlier in February than 20 February. In particular, Dyldam was aware that the Statement of Claim had originally asserted that the injury occurred on 12 February, and that a number of significant contemporary documents gave 12 February as the date of the accident. If Dyldam had sought to lead evidence as to what happened on 12 February (or indeed other days in February on which, according to the evidence, the accident may have occurred), it is in my view unlikely that it would have been rejected. Dyldam makes no suggestion in this Court that there was in fact such evidence, or that it would have conducted the case any differently if the pleadings had alleged 12 February as an alternative date. If Dyldam wished now to claim that it had been misled, it would in my opinion have needed to give evidence of this and to produce to this Court the evidence that it did not lead because it was misled. 34 In any event, as it happens, in my opinion it was highly probable that any accident as described by the plaintiff did occur on 20 February. His visit to Dr Mihrshahi must have been on 20 February, and both Dr Mihrshahi's note and the plaintiff's own evidence were clearly to the effect that the event that caused him pain occurred that morning. The "not w/c" note by Dr Mihrshahi does not suggest otherwise: it probably merely reflects the fact that it was not (at whatever time the note was made) intended to claim workers compensation because Bricklaying was to continue to pay wages. 35 The main factors relied on by Dyldam to suggest that the injury could not have occurred on 20 February do not weigh strongly against the plaintiff's account, accepted by the primary judge, for reasons the primary judge in fact gave. 36 Dr Shnier's opinion that the appearance of a callus, as shown on the CT scan taken on 13 March, takes "closer to 5-6 weeks" to develop has to be understood having regard to his mistaken assertion that the CT scan was taken "within two weeks of the alleged fall". The CT scan was taken three weeks after the alleged fall, and three weeks is in fact closer to 5-6 weeks than is two weeks. Dr Shnier was not asked to express an opinion as to the probabilities as to whether the callus could have developed the appearance shown in the CT scan in three weeks; and in my opinion the primary judge was justified in giving his opinion limited weight. 37 The reference in Dr Mihrshahi's note as to inability to "sleep on the back" could refer to the plaintiff's assessment of the situation from his having lain on his back; and having regard to the plaintiff's evidence that he did not try to identify the date of the injury until asked to do so some time later, the reference to 12 February in workers' compensation documents is of limited weight. 38 As pointed out by Ms Norton SC for the plaintiff, the CT scan showed the plaintiff had a broken back, and this seems consistent with Dr Mihrshahi's note that the plaintiff said he was in terrible pain; and it was unlikely in the extreme that he would have been wheeling barrow-loads of bricks or mortar with a broken back. Accordingly, it was unlikely in the extreme that this injury occurred to the plaintiff on some date earlier than the 20 February, the first date on which he saw a doctor about this condition. 39 There was no error by the primary judge in finding, on the basis of the plaintiff's evidence, that the ground surface over which he had to wheel the wheelbarrow was uneven and unsuitable for the use of a wheelbarrow, whether the particular disturbance in which the plaintiff's wheelbarrow was caught was caused by a bobcat or in some other way. It is true that the plaintiff's evidence strongly tied the disturbance in which his wheelbarrow was caught to the use of a bobcat; but the primary judge did not have to accept that aspect of his evidence. In any event, in fact the primary judge did accept, on the balance of probabilities, that the disturbance was so caused. 40 As regards the more general submission that the primary judge did not give adequate reasons for accepting the plaintiff's evidence, having regard to the various problems raised by the appellant, in my opinion that submission is not made out. In the light of the above discussion of the main issues raised by the appellant, the primary judge's reasons were adequate. Particularly is this so in circumstances where Bricklaying did not call witnesses who (unlike Arazio) were not shown to be unable to give evidence, in particular, a bricklayer named David to whom the plaintiff first reported his accident, and Arazio's nephew Salvatore to whom the plaintiff gave his medical certificate on the day after the accident. There was very limited evidence called on behalf of Dyldam also. 41 For those reasons, in my opinion there is no error in the primary judge's reasons that calls for appellate intervention.

Rejection of Evidence 42 On the third day of the trial, Mr Fayad was called on behalf of Dyldam. He produced a very large book, referred to as a journal, which was said to be maintained on behalf of Dyldam and associated companies. It was said to record the names of all employees of these companies, and where each of them worked on each day in the period it covered. The journal was produced to show that no bobcat driver had been employed at 12-14 Connie Avenue on 20 February 2003. 43 Senior counsel for the plaintiff objected to this evidence, and it was taken on the voire dire. In support of this objection, senior counsel for the plaintiff relied on a subpoena served on Dyldam in June 2006, which required production of "documents relating to the personnel, wage and work records of all bobcat drivers who worked on site at 12-14 Conie Avenue Baulkham Hills New South Wales during any period of construction." Nothing was produced in response to this subpoena by Dyldam, apart from a document purporting to be a list of bobcat drivers with the dates upon which they worked at the site, these dates not including 20 February 2003. The plaintiff's solicitors vigorously pressed for compliance with the subpoena, but no further documents were produced, and Dyldam's solicitors advised that most records had been destroyed by water damage. 44 The primary judge gave the following reasons for rejecting this evidence: [20] Senior counsel for the plaintiff therefore sought that the evidence be excluded in the exercise of the discretion conferred by s 135 of the Evidence Act 1995. That section is in the following terms: 135 General discretion to exclude evidence The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might: (a) be unfairly prejudicial to a party, or (b) be misleading or confusing, or (c) cause or result in undue waste of time.

[21] The plaintiff has had no opportunity either to investigate or to confirm what is sought to be proved by reference to the journal. It is quite unfair to require the plaintiff to accept at face value evidence such as this during the course - indeed, on the penultimate scheduled day - of a trial.

[22] Senior counsel who appeared for the first defendant ultimately accepted that the evidence in the voir dire established malfeasance on the part of the first defendant or its legal advisers. He was unable, in the face of the correspondence, to justify the repeated failure to produce the journal. No explanation for the failure to produce it was forthcoming or even attempted.

[23] Senior counsel argued, however, that the evidence is of such moment to the first defendant's case that it would be unfair to the first defendant to exclude it. He characterised the evidence as "fatal" to the plaintiff's case. In my opinion the significance of the evidence in the first defendant's case only intensifies the prejudice to the plaintiff. What the argument overlooks is that evidence that is critically advantageous to one party is, by corollary, correspondingly critically disadvantageous to the opposing party.

[24] I wish here to emphasise that the course I propose to take is not taken with any intent of punishing or penalising either the first defendant or its legal representatives. My focus is entirely upon the issues raised by s 135. Senior counsel for the first defendant argued that the appropriate course is to admit the evidence and allow the plaintiff time to meet it. Not surprisingly, he accepted that the costs of any delay so occasioned would have to be borne by the first defendant.

[25] In general run of cases I would conclude that this would be the appropriate course to take. While I do not necessarily accept, as contended on behalf of the first defendant, that the issue of the presence or absence of bobcat drivers onsite on 20 February 2003 is determinative, and that proof of their absence would be fatal to the plaintiff's case, I do accept it is an issue of, at least potentially, considerable significance.

[26] But also relevant to the determination is the condition of the plaintiff. That is why I spent some time at the outset of these reasons outlining my observations of him.

[27] To adopt the course proposed on behalf of the first defendant would, in my opinion, cause or result in undue waste of time. Such a course would be unfairly prejudicial to the plaintiff. In saying this, I recognise that s 135 is not directed to unfair prejudice caused by the consequences of admitting evidence - it is directed to any unfair prejudice caused by the admission of the evidence. I do not take the view that the evidence tendered through Mr Fayad of itself would necessarily be unfairly prejudicial to the plaintiff, if he had had an adequate opportunity to investigate it. It is unfairly prejudicial because he is confronted with significant evidence to which he was entitled to have access a year ago, and which, through his solicitors, he made repeated and persistent efforts to have produced. His only alternatives are either to accept the first defendant's interpretation of the journal, or to submit to what may turn out to be a lengthy adjournment to enable his solicitors (who have, in this respect, demonstrated considerable diligence) to undertake investigations they should have been able to undertake a year ago, and after the loss of another year with all that that implies in terms of fading memories, disappearance of potential witnesses and the like; as well as the emotional hardship that would be occasioned by adjournment. I base my decision principally on s 135(c).

[28] S 135 prescribes the three circumstances that may trigger the exercise of the discretion it confers; the decision is itself, ultimately, a discretionary one. In this respect the prejudice that would be caused to the plaintiff by adjournment is a relevant consideration. So also is the flagrancy of the conduct of the first defendant. The former has influenced my judgment very much more than the latter, which has played only a minor role. 45 Mr Graves submitted that the primary judge erred in rejecting the evidence, in that it was of high probative value and capable of causing a trial judge to reject the plaintiff's case. 46 Mr Graves submitted that, although the journal should have been produced, production would not have affected the plaintiff's preparation of the trial. Until the statement of claim was amended on the first day of the trial, it alleged that the accident occurred on 12 February 2003; and the list of bobcat drivers produced by Dyldam showed that a bobcat was present on the site on 12 February 2003. The journal would have been unintelligible without assistance from Mr Fayad, and there would have been no occasion for the plaintiff to seek to have it interpreted, when the plaintiff had an admission that a bobcat was on the site on the date when the plaintiff alleged the accident occurred. 47 Mr Graves also submitted that the primary judge did not assess the probative value of the journal, and did not identify any respect in which it was unfairly prejudicial to the plaintiff and/or would cause undue waste of time; and the primary judge did not undertake the balancing exercise required by s 135. He submitted there was no evidence as to the length of any adjournment the plaintiff would seek if the journal was admitted; and that an adjournment of that type was not in any event a "waste of time" within s 135(c). On any reasonable assessment, he submitted, the probative value of the journal and Mr Fayad's evidence concerning it would outweigh any unfair prejudice and/or waste of time. 48 Mr King supported Mr Graves' submissions. 49 In my opinion, the primary judge did appropriately accept the potential probative value of this evidence. Although she did not accept that the issue of the presence or absence of bobcat drivers on 20 February 2003 was determinative, she did accept it as potentially one of considerable significance. Having regard to my earlier analysis, I see no error in this assessment. 50 In my opinion, the primary judge was correct to identify the plaintiff's alternatives, in the event that the evidence was admitted, as being in substance either to accept Dyldam's interpretation of the journal, or to submit to what might turn out to be a lengthy adjournment. Although this was not spelt out in terms by the primary judge, it is clear in my opinion that she accepted that if the plaintiff chose the first of these alternatives, there was a danger that the admission of the journal might be unfairly prejudicial to the plaintiff. The journal was a document that did not on its face prove anything, and its probative value depended on Mr Fayad identifying (without documentary support) what various symbols in it meant, which employees were bobcat drivers, on what basis entries were made and how reliable they were in relation to (for example) movement of bobcat drivers between nearby sites, what was the significance of whited out entries on relevant days, and so on. If such evidence were admitted without the plaintiff having an opportunity to test it properly, because of Dyldam's previous failure to comply with a subpoena, there would be a danger that the evidence might be unfairly prejudicial: Commonwealth of Australia v McLean (1997) 41 NSWLR 389 at 402, Bakerland Pty Ltd v Coleridge [2002] NSWCA 30 at [55]. It was by no means clear that the evidence, if properly tested, would have the probative value claimed for it; but if admitted without being properly tested, it could be given probative value it did not deserve. 51 On the other hand, if an adjournment were granted, this danger of prejudice would be avoided; but in my opinion the delay to the trial would correctly be regarded as a waste of time. Particularly is this so because it could require the recall of witnesses who had already given evidence, including the plaintiff and Mr Chia. In my opinion, a substantial delay to the conclusion of a case that should have not occurred, but did occur because of flagrant misconduct by one party, is a waste of time within s 135(c). In my opinion also, the primary judge was entitled to give considerable weight to this waste of time in this case, because of the unfortunate medical condition of the plaintiff, the emotional hardship to him, the flagrancy of Dyldam's conduct and the circumstance that delay would make proper investigation of the matter less effective. 52 In my opinion the primary judge's reasons show she did weigh the competing considerations. There is some force in Mr Graves' submission to the effect that the journal should not be regarded as having been deliberately withheld from the plaintiff, because until the amendment to the statement of claim on the first day of the hearing, it was not inconsistent with the plaintiff's case; but this submission was apparently not relied on below and in my opinion is not sufficient to outweigh the other considerations. A decision under s 135 is a discretionary decision, and in my opinion no error justifying appellate intervention has been shown.

Apportionment of Responsibility 53 Submissions concerning apportionment of responsibility were essentially to the effect that the apportionment of 75/25 could only be justified if the plaintiff's evidence as to involvement of bobcats was accepted. Since the primary judge did accept this evidence and this Court is not disturbing that finding, insufficient reason is shown to disturb the apportionment.

Economic Loss 54 At the date of the accident the plaintiff was aged 29, and at the date of the hearing he was aged 33. 55 The evidence before the primary judge was that Bricklaying paid the plaintiff as if he were a subcontractor, and it was common ground that he was paid without deduction of income tax. He was paid by direct credit to his bank account. 56 The evidence was that, during the period 1 July 2002 to 20 February 2003, there were 26 payments made over 33 weeks totalling $21,317, giving an average of $646 per week. If tax had been deducted, the corresponding figure would be $562. After 20 February 2003 there was a payment of $1,168.75 on 27 February, and then weekly payments of $935 from 5 March to 22 May inclusive. 57 The plaintiff's workers compensation claim form dated 12 May 2003 stated that he worked a 40-hour week and that his gross weekly pay was $931. 58 The plaintiff produced tax returns for the financial years ending 30 June 2000, 2001 and 2002; but not for the financial year ending 30 June 2003. Bricklaying's counsel sought to cross-examine him on these returns, but at the invitation of the primary judge a schedule was prepared summarising their effect, as follows: Jones v Dyldam Pty Limited Tax Return Summary

1. 30 June 2000 gross income $16024 tax $ 2124 $13900

2. 30 June 2001 gross income $23,910 tax $ 3553 $20357

3. 30 June 2002 gross income $5053 tax Nil $5053

1. 30 June 2000 $8545 2. 30 June 2001 $2907 3. 30 June 2002 $ 4150 total $15,602 ÷ 3 = $5200.67 ÷ 52 = $100.01 pw 59 In written submissions to the primary judge, Bricklaying's counsel referred to the following passage from Giorginis v Kastrati (1988) 49 SASR 371 at 375, per von Doussa J (with whom King CJ and Legoe J agreed), concerning the absence of satisfactory evidence concerning tax returns: If a plaintiff does not adduce evidence of this kind which is in his power or possession many uncertainties are likely to remain. It does not necessarily follow, as a matter of law or fact, that proof of the plaintiff's claim for loss of earning capacity will fail … however, the assessment is likely to be a modest one having regard to the uncertainties unnecessarily left open by the evidence. 60 It was submitted for Bricklaying before the primary judge that the plaintiff's economic loss as at 20 February 2003 was at a rate between $562 net per week and $456.34 net per week (this lower figure taking into account suggested work deductions and GST). As at the date of the trial, it was put that the figure could be increased by 13 per cent, which was said to be an agreed rate of inflation. As regards future economic loss, it was submitted for Bricklaying that, due to cycles in the building industry and the heavy nature of the work of bricklayer's labourers (making it unlikely that the plaintiff would continue as such until age 65), the deduction for vicissitudes should be 20 per cent rather than 15 per cent. 61 The primary judge made the following findings concerning the rate of wage loss: [52] Alternative proposals were put on behalf of the plaintiff, and on behalf of Sydney Bricklaying as to the appropriate way of calculating the plaintiff's wage loss. Sydney Bricklaying relied upon evidence of its payments directly to the plaintiff's bank account over a period of 33 weeks prior to 20 February 2003. In that time, 26 payments of varying amounts were made, giving the plaintiff a total sum of $21,317. This is an average of $646 per week. There is no explanation of how these amounts were made up. Counsel for Sydney Bricklaying also referred to evidence of the plaintiff's earnings prior to his employment by Sydney Bricklaying. He put two alternatives, one on the assumption that the plaintiff remitted the GST amount to the ATO, the other on the assumption that he retained it. It was in this context that counsel argued that the amount should be reduced. This was because the "tax invoices" which the plaintiff was given when he was paid purported to show an amount referable to GST. Had the "tax invoices" been what they purported to be, it would have been the plaintiff's duty to remit that tax to the ATO. (That argument is based upon the premise that the invoices, denoting what Sydney Bricklaying in fact paid to the plaintiff, provide the appropriate foundation for the calculation.) In my opinion it is unlikely to the point of absurdity that the plaintiff did remit an amount attributed to GST to the ATO. I doubt that he had the slightest understanding of the manner in which he was paid or any obligations he might have had in respect of amounts of GST he received. As I have said above, he is unsophisticated and guileless. The alternative proposal put by counsel was calculated on the basis that the plaintiff did not remit the GST amount to the ATO, but did pay income tax on the amount he was paid.

[53] Senior counsel for the plaintiff took a different approach. He pointed to evidence that, following his accident, Sydney Bricklaying continued to pay him until the workers' compensation claim was made whereupon its insurance company took over the payments, although these were made through Sydney Bricklaying. The plaintiff's bank statements show that, consistently from February 2003, weekly amounts of $935 were deposited in the name of Sydney Bricklaying to his account and identified as "wages". There is also the evidence of the workers' compensation claim form, to which I have already referred in another context. This shows a claim of a gross weekly wage rate of $931. No doubt it was on that basis that Sydney Bricklaying made the payments as it did. There is authority for the proposition that payment of workers' compensation by an insurer is admissible as an admission of incapacity against a defendant/employer in whose name the insurer defends common law proceedings: Heuston v Yore Contractors Pty Ltd , unreported, 9 March 1992, per David Hunt CJ at CL There is no reason why the same principle should not apply to the determination of quantum of wages in respect of which the payments are made. This may be taken to be the plaintiff's base wage rate.

[54] Certainly, Mr Grasso gave no evidence to contradict the proposition that this represented the appropriate level of payment for the plaintiff. In this respect I have not overlooked the circumstance, never fully explored in evidence or explained, that, on Sydney Bricklaying going into liquidation, its records were handed over to the liquidator and subsequently could not be found.

[55] I accept the argument put on behalf of the plaintiff, that the most accurate estimate that can be made of the plaintiff's wage loss is to be made by reference to the figure that was in fact paid, and paid for at least some months after his injury. That is not the end of the calculations. The plaintiff's wife gave evidence that he worked most Saturdays. The amount, as overtime, which he was paid for then is not included in his basic wage rate. I also accept that, in order to calculate the plaintiff's correct wage loss, an amount ought to be included attributable to the overtime that he usually worked. Allowing only one-fifth of his weekly wage rate (and therefore not allowing for penalty rates) would add $187, giving a total of $1,122 gross per week. The plaintiff's wage loss will be calculated on this basis. 62 The primary judge made the following assessment of discount for the purposes of s 13 of the Civil Liabilities Act 2002: [71] I turn, then, to assess the "percentage possibility" that the plaintiff may have been rendered unemployable by some mechanism other than the injury the subject of these proceedings. That assessment involves a foray into unknown territory. However, the exercise is little different to the exercise that has conventionally been undertaken by courts awarding damages for future economic loss. The "conventional" 15% was based upon the accumulated experience and knowledge of judges dealing with cases of personal injury. It represents the known possibilities that individuals may suffer non-compensable injury or accident, or may, in other ways, have their earning capacity reduced or eliminated.

[72] Here, the plaintiff was, before February 2003, a fit young man, able to discharge the heavy duties of his employment without apparent difficulty (other than some occasional muscle tiredness or soreness resulting from the nature of the work he was doing). There is no evidence that he engaged in any activities that would have exposed him to greater than normal danger or increased the risk that he would have lost the capacity to work.

[73] Senior counsel who appeared for Dyldam argued for an "adverse vicissitudes contingency" reduction of as much as 50%. This was based upon the report of Dr Shnier. Dr Shnier said that there was: … a long standing pre-existing degenerative intervertebral disc disease at L5/S 1 … evidenced by the disc space narrowing.

[74] He referred also to evidence that the plaintiff had sought medical advice in relation to back pain - which the plaintiff insisted, and I accept, was no more than muscle strain for the reasons I have already mentioned - and also called in aid a back injury suffered by the plaintiff in 1993 in a motor vehicle accident. The latter I discard completely - there was no evidence that the plaintiff continued to suffer any ill effects from that injury; there is evidence that he recovered, by way of damages, what seems to be a very small amount, indicative of a not very serious injury; and, finally, the plaintiff was able to engage in the very heavy work of a bricklayers' labourer. There was no evidence tendered to suggest that the degenerative condition would have precluded him from continuing to work in his occupation as a bricklayers' labourer or in some other unskilled work yielding comparable income.

[75] Accordingly, I decline to increase what I consider to be a reasonable figure to allow for the vicissitudes, as now required by s 13; the amount allowed for future economic loss will be reduced by 15% for that purpose. 63 On that basis, the primary judge awarded damages for economic loss which were calculated as follows: Past wage loss (average weekly earnings of $1,122 p.w. $850 nett p.w. to date - 4.33 years) 230 weeks x 850 195,500

Past loss of superannuation 9% of $1,150 gross per week - for 4.33 years 230 weeks x $103.50 p.w. 23,805

Future wage loss ~ $930 per week until age 65 (31.17 years) 835.7 x 930 = 777,201 Less 15% = 116,580 660,624

Future loss of superannuation 9% of $1,240 per week - $111.60 per week 111.60 x 835.7 = 93,264 Less 15% = 13,989 79,274 64 By consent, there was some material concerning average weekly earnings, award wages, and taxation rates given to the Court of Appeal. This material indicated that a gross wage of $1,122 per week would be the equivalent of a net wage of $818.92 per week. Tables of award wages suggested that wages for builder's labourers were about $520 per week at the date of the accident and $625 per week at the date of the trial. Tables of average weekly earnings for males suggested that these would have been about $916 per week at the date of the accident and $1,074 per week at the date of trial. 65 Mr King SC for Bricklaying submitted that the primary judge made errors in the calculation of economic loss. He submitted that, having regard to the income tax returns that were produced and the wages actually received prior to 20 February 2003, there was no justification for adding an amount for overtime and indeed no justification for going above the $646 per week average over the 33 weeks prior to the accident. He pointed out that the net figure was about $30 too high in any event. He submitted, even accepting that the rates for future economic loss should be as determined by the judgment, the future economic loss should have been calculated at $850 per week rather than the $930 adopted by the judge. In any event, he submitted, the rate adopted in the judgment was too high, for reasons similar to those put in relation to past economic loss. 66 In my opinion, it was erroneous for the primary judge to have paid no regard to the plaintiff's record of earnings, as disclosed by his tax returns and as disclosed by the records concerning the 33 weeks prior to the accident. Those were important matters, and if they were to be totally disregarded, they needed to be explicitly addressed and reasons given for disregarding them. The failure of the plaintiff to lead satisfactory evidence concerning his pre-accident employment earnings, and to give any explanation for the earnings shown in the income tax returns, means in my opinion that uncertainties created by this absence of evidence should not be resolved in the plaintiff's favour. 67 In my opinion, it is appropriate to take the figure of $562 per week as the basis for calculating past economic loss, and to take a figure of $562 plus 13 per cent, that is $635, as a basis for calculating future economic loss. I would take the equivalent gross figures to be $646 per week and $730 per week, and those figures may be used for calculation of superannuation. (I would interpolate that even this may be unduly favourable to the plaintiff, since he had been paid on a basis that did not carry superannuation: however, no point was taken about this.) Taking these figures, I would not change the 15 per cent discount for vicissitudes. 68 On that basis, it seems to me that the following calculations are in order: Past wage loss 230 x $562 = $129,260

Past loss of superannuation 230 x $646 x 0.9 = $13,372

Future wage loss 835.7 x $635 x 0.85 = $451,069

Future loss of superannuation 835.7 x $730 x 0.9 x 0.85 = $ 46,670 total $640,371 69 That is the figure I would adopt, in lieu of $959,203 adopted by the primary judge, resulting in a deduction from the verdicts of $318,832.

Form of Orders 70 The primary judge made the following orders: TERMS OFJUDGMENT OR ORDER -

Judgement for the Plaintiff against the first Defendant in the sum of $2,642,095.

Judgement for the Plaintiff against the Second Defendant in the sum of $967,607.

As to the first Cross-claim, a judgement for the First Defendant against the Second Defendant in the sum of $241,901.75.

As to the Second Cross Claim, a judgement for the Second Defendant against the First Defendant in the sum of $725,705.25.

The Court notes the agreement between the Plaintiff and the Second Defendant that pursuant to section 151A (1) (b) of the Workers Compensation Act 1987, the Plaintiff gives to the second Defendant credit of $89,193.48 to the weekly payments of compensation already paid and to be deducted from the damages.

The First Defendant is to pay 75% of the Plaintiff's costs of the proceedings.

The Second Defendant is to pay 25% of the Plaintiff's costs of the proceedings.

The First Defendant and the Second Defendant are to each pay their own costs of the First Cross claim and of the Second Cross claim.

The Court notes the agreement between the Plaintiff and the First Defendant that the Plaintiff gives the First Defendant credit of $356,177.38 to the payment of workers compensation, excluding the weekly payments of compensation already paid.

The Court notes the agreement of the First Defendant and the Second Defendant that: (a) The First Defendant shall pay to the Second Defendant the sum of $356,177.38 within 28 days of this Order, and

(b) If the sum of $356,177.38 is not paid within 28 days, then the First Defendant shall in addition pay to the Second Defendant interest on the balance outstanding from time to time as if a judgement at the rates provided for in Schedule 5 to the Uniform Civil Procedure Rules 2005.

The Court notes that pursuant to paragraph 10 hereof, payment by the First Defendant of the judgement sum referred to in paragraph 1 hereof is satisfaction of the judgement on the Second Cross Claim.

Stay of all judgements up to and including 10 August 2007. 71 The calculation was based on the following table: SECTION 151Z APPLICATION Leonard v Smith [1992] 27 NSWLR 5

Step 4 Work out the percentage fault of the employer and the non employer

Step 5 Apply the percentage of the employer to the difference and deduct the amount so calculated from the non employers verdict

Non-employer credit for workers compensation paid by Second Defendant of 443,626.13

Employer credit for workers compensation paid of 89,193.48 72 It appears that the slightly increased figures follow from a slight delay from an original calculation. These calculations will need to be re-done. 73 As to the form of the orders, it seems to me that the following alterations should be made. 74 First, since court orders should if possible be capable of being understood without reference to the judgment, the orders should make it clear that the plaintiff's total recovery is the amount of the judgment against Dyldam. 75 Second, there should not be judgments on the two cross-claims, but merely verdicts: see Andrews v Nominal Defendant (1963) SR(NSW) 110. It may also be helpful to add a declaration to the effect that Dyldam is entitled to a contribution from Bricklaying of 25 per cent of the amount paid by it, and that Bricklaying is entitled to a contribution from Dyldam of 75 per cent of the amount paid by it. 76 Although Dyldam did not itself challenge the amount of the verdict as such, it is clear in my opinion that the verdict against Dyldam as well as that against Bricklaying should be adjusted in the way I have indicated. In addition, the notice of appeal suggests that there has already been payment of some or all of the judgments below, as restitution was sought. The precise terms of any order for restitution, if it is still sought, would need to be addressed. I propose the following orders: (1) Dyldam's appeal dismissed with costs. (2) Bricklaying's cross-appeal upheld in part. (3) Each party to pay their own costs in relation to Bricklaying's cross-appeal, and the plaintiff to have a certificate under the Suitor's Fund Act in respect of his own costs. (4) The parties to bring in Short Minutes to give further effect to this judgment. 77 BASTEN JA: I agree with the orders proposed by Hodgson JA and with his Honour's reasons. I seek to add some further remarks in relation to the challenge to the ruling of the primary judge in excluding evidence in exercise of her Honour's discretion under s 135 of the Evidence Act 1995 (NSW): see Jones v Dyldam Developments Pty Ltd [2007] NSWSC 752. The terms of s135 are set out at [44] above. 78 Section 135 has a number of features which should be identified at the outset. First, it is based on an assumption, namely that the evidence in question is otherwise admissible. Secondly, it confers a power to refuse to admit such evidence if a particular opinion is formed. Even if the power is engaged, it would seem to be discretionary, and the Court could still admit the evidence. Thirdly, the opinion involves a balancing exercise. That which is to be put into the balance on one scale is the probative value of the evidence, namely "the extent to which the evidence could rationally affect the assessment of the probability of the existence of a fact in issue": Evidence Act, Dictionary. A trial judge will frequently be asked to make rulings involving such an assessment, without being able to determine with any certainty the likely effect of the particular evidence, depending on the stage the trial has reached. In the other scale, the court must assess a "danger" that the evidence might, if admitted, have one of three classes of effect. Fourthly, the power to reject the evidence will only be engaged if the probative value is "substantially outweighed" by a danger of the kind identified in one of paragraphs (a), (b) or (c). 79 A challenge to a ruling under s 135 may be directed either to the formation of the relevant opinion or to the exercise of the discretionary power, once engaged. Although the distinction is frequently elided, there is a difference in principle between assessing a challenge to an inference drawn by a trial judge from primary facts (including an inference involving an evaluative judgment), as in Warren v Coombes (1979) 142 CLR 531, and the exercise of a discretionary power, which is subject to review on the grounds set out in House v The King (1936) 55 CLR 499 at 505. 80 In CDJ v VAJ [1998] HCA 67 and 76; 197 CLR 172, McHugh, Gummow and Callinan JJ described ss 135 and 136 of the Evidence Act 1995 (Cth) as "conferring a very wide discretion upon trial judges": at footnote (106). Their Honours saw the introduction of these sections as a deliberate departure from the common law rules governing civil trials. Section 137, by contrast, may be seen as reflecting the established general law principle with respect to criminal trials and the exclusion of unfairly prejudicial evidence: see Driscoll v The Queen (1977) 137 CLR 517 at 541 (Gibbs J). 81 Despite the differing scope and operation of the sections, it was suggested in Ainsworth v Burden [2005] NSWCA 174 that each of the phrases "unfairly prejudicial" and "unfair prejudice" in ss 135, 136 and 137 must be given the same meaning: at [99] (Hunt AJA, Handley and McColl JJA agreeing). It is not necessary to explore the correctness of that dictum in the present case: it is, however, necessary to consider whether the kind of prejudice relied on in the present case falls within the scope of s 135. 82 A significant issue in the present case arose from the plaintiff's evidence that the accident was caused by unevenness of the ground resulting from the use of a bobcat in the area. The evidence sought to be adduced by the appellant supported a conclusion that no bobcat had operated in the area on the relevant day. As explained by Hodgson JA, the evidence included both the documentary record of the appellant and the evidence of Mr Fayad which was necessary in order to understand the record. It was not suggested that the trial judge would not be able to deal with this evidence appropriately, but that it would be procedurally unfair to expect the plaintiff to deal with it effectively in the circumstances in which it was produced in the course of the trial. The first question was therefore whether such unfairness could fall within the scope of the section, an issue about which it has been said that conflicting views have been expressed: see Ainsworth v Burden [2005] NSWCA 174 at [105] (Hunt AJA, Handley and McColl JJA agreeing). 83 A danger of unfair prejudice may arise if "the fact-finder may use the evidence to make a decision on an improper, perhaps emotional, basis, ie on a basis logically unconnected with the issues in the case": Australian Law Reform Commission, Evidence, Report No. 26 (Interim) (1985), vol 1, par 644. Further, referring to factors now found in paragraphs (b) and (c) of s 135, the Commission noted "the risk of the court being misled (eg by incorrectly assessing the weight of the evidence) and the risk of confusion and of undue wastage of time". 84 This discussion is to be found under the heading "Relevance", from which it may be inferred that s 135 was designed to allow a court to avoid foreseen difficulties with a rule that relevant evidence is admissible where the definition of relevance required only "a minimal logical connection between the evidence and the 'fact in issue'": par 641. 85 If the concept of unfair prejudice is read in the restrictive sense suggested by the Commission at par 644, it is unlikely to have a significant operation in cases where there is no jury. The same may be said in relation to evidence which might be "misleading or confusing" within the terms of paragraph (b). The same could not necessarily be said of evidence which might cause wastage of time, for the purpose of paragraph (c). In Papakosmas v The Queen [1999] HCA 37; 196 CLR 297, a case involving the possible exercise of the Court's discretion to limit the use of particular evidence under s 136, but not in terms concerned with s 135, McHugh J cast some doubt upon suggestions that unfair prejudice might extend to cover "procedural disadvantages which a party may suffer as the result of admitting evidence under the provisions of the Act": at [93], referring to Einstein, "'Reining in the Judges'? - An examination of the discretions conferred by the Evidence Act 1995", 19 UNSWLJ 268 at 273-274. His Honour also suggested, at [93], that the course taken by this Court in Commonwealth of Australia v McLean (1996) 41 NSWLR 389 at 402 (Handley and Beazley JJA, Santow AJA agreeing) was to "exclude hearsay evidence otherwise admitted via the exception contained in s 64". Although in McLean their Honours suggested that such a course might have been adopted, it was not the conclusion reached. 86 In Ordukaya v Hicks [2000] NSWCA 180 this Court considered a decision of Cooper DCJ who had declined to exclude hearsay on the basis that it was unfairly prejudicial to the other party, who was denied the opportunity to cross-examine because: "To my mind that is not what is meant by unfairly prejudicial in the context of s 135 of the Act. What is meant in context of the Act is unfairness in the obtaining of the evidence, that is, in the circumstances under which the evidence was procured." 87 Mason P concluded that that approach was too narrow and preferred the view expressed in an earlier edition of Odgers, Uniform Evidence Law (3rd ed, 1998) at p 443, set out at [6]: "On the other hand the provision is not limited to misuse of the evidence by the tribunal of fact. Unfair prejudice may arise from procedural considerations. Thus an opposing party may be significantly prejudiced by hearsay evidence if unable to cross-examine on a crucial issue in the litigation. Alternatively, the opposing party may be unfairly prejudiced by evidence if prevented from properly challenging its reliability." 88 Sheller JA (with whom Meagher JA agreed) was not satisfied that Cooper DCJ erred in his approach, but nevertheless considered whether the absence of the maker of a hearsay statement could result in the exclusion of evidence under s 135 and stated at [39]: "It is not necessary in this case to decide whether it ever could or whether it is confined to situations, like those in the cases to which I have referred, where the statement has been obtained by unfair means or has a tendency wrongly to excite the fact finder's emotions and is of little probative value." 89 A similarly cautious approach to the rejection of hearsay evidence on the basis of unfair prejudice is to be found in Clark [2001] NSWCCA 494; 123 A Crim R 506 at [165] (Heydon JA, Bell J agreeing). In other cases, the inability to cross-examine has been treated as a relevant, though not necessarily a decisive issue in the exercise of the discretion under s 135: see R v Suteski [2002] NSWCCA 509; 56 NSWLR 182 at [126] (Woods CJ at CL, Sully and Howie JJ agreeing) and Bakerland Pty Ltd v Coleridge [2002] NSWCA 30 at [55] (Giles JA, Heydon JA and Grove J agreeing). 90 With respect, I do not read the cases referred to in Ainsworth as demonstrating any clear conflict of principle. The area in which differences of approach may be perceived concerns the inability of a party to cross-examine the maker of a statement where he or she is not called and the evidence is given by way of hearsay. On one view, such circumstances may properly provide a basis for rejection of such evidence if its admission would give rise to "unfair prejudice"; on another view, the rejection of the proffered evidence may involve the courts reintroducing the rule excluding hearsay evidence which was explicitly repealed by the Evidence Act. However, this case is not one in which the rejection of the evidence under s 135 could be seen as a backdoor means of applying a common law exclusionary rule which had been reversed by statute. There is no principled basis for effectively restricting the operation of paragraphs of (a) and (b) of s 135 to jury trials. Nor would such an approach be consistent with that adopted by this Court in Ordukaya. 91 It is, therefore, appropriate to treat s 135 as engaging the power to reject admissible evidence in circumstances where the admission might satisfy any one of the three classes of danger set out in the section. Such an approach was adopted in circumstances not dissimilar to the present in Barrett Property Group Pty Ltd v Metricon Homes Pty Ltd [2007] FCA 1509 by Gilmour J at [161]. In addressing a photograph sought to be tendered by the respondents, his Honour considered that prejudice arose "from the failure of the respondents to provide this evidence prior to the hearing or even to adduce it in chief, so as to enable it to be properly considered and responded to by the applicants". His Honour also noted that the photograph was not clear in its depiction of a key factor and that, had it been admitted, he would have placed no weight upon it. 92 Further support for this approach derives from a consideration of the practical circumstances of a trial. Where evidence is produced, as in the present case, on the third day of a trial, in circumstances where it should have been produced in response to a subpoena well before the trial, the party seeking to tender it may well accept, as occurred in the present case, that the plaintiff would be entitled to an adjournment and an opportunity to consider and respond to the material. (Indeed, senior counsel for the appellant was at pains to point out that his client had not merely accepted the need for an adjournment, but had offered to bear the cost consequences and any other conditions which might reasonably be imposed.) The trial judge was in effect invited to rule upon an adjournment application not made by the appellant, but caused by the appellant's conduct. If questions of fairness and prejudice would justify the refusal of an adjournment application if made by the appellant, it would be curious if they did not also permit the refusal of the evidence. 93 As noted above, the trial judge sought to base her decision "principally on s 135(c)": [2007] NSWSC 752 at [27] set out at [44] above. This approach may lead to a question as to how an undue waste of time may be said to outweigh substantially the probative value of the evidence. Read in the context explained by the Law Reform Commission, the apparent purpose of this provision is to allow a trial judge to avoid an inappropriate expansion of the trial caused by the parties tendering, and then seeking to meet, evidence of slight or peripheral relevance to the facts in issue. Once it is accepted that the probative value of the proffered evidence is significant or substantial, there may be limited scope for exclusion on the basis of a danger of "undue waste of time". One case in which paragraph (c) may properly be invoked despite the potential significance of the proffered evidence is where the real probative value of the evidence is not able to be adequately addressed without further investigation. These circumstances, which existed in the present case, suggest that both paragraphs (a) and (c) were available as a basis for engaging the discretionary power. 94 Once it is accepted that there was power to reject the evidence absent an adjournment, the appropriateness of an adjournment and the extent to which a costs order might reduce the element of prejudice become significant factors. Whether these factors were relevant to the danger of prejudice or undue waste of time, or whether they were better dealt with as part of the Court's discretion once the power was engaged, was not addressed on this appeal. That was in part, no doubt, due to a recognition that once it was established that the relevant danger substantially outweighed the probative value of the evidence, it would be difficult for the appellant to challenge the exercise of discretion. Although the discretionary power is engaged, it may nevertheless be open to the Court to admit the evidence, for example because the party resisting admission has failed to take reasonable steps itself to avoid the prejudice. In the present case, however, it was the party seeking to tender the evidence which had been derelict in compliance with its obligations in response to a subpoena and subsequent inquiries from the plaintiff's solicitors. 95 In any event these factors were addressed by the trial judge. In the circumstances, I am not satisfied that her Honour's exercise of the discretion miscarried, for the reasons set out above and those given by Hodgson JA. **********

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