Eveready Australia Pty Ltd v Gillette Australia Pty Ltd

REASONS FOR JUDGMENT 1 This interlocutory motion raises the question whether the respondent's affidavit evidence critical of the form and methodology of the applicant's survey evidence, should be ruled inadmissible because of the respondent's non-compliance with Federal Court Practice Note No 11. 2 The applicant Eveready Australia Pty Limited ("Eveready") filed a Notice of Motion dated 14 September 1999 seeking the following order: "That the respondent is not entitled to rely on the affidavit of Ian Robert Gordon, to the extent that such affidavit relates to the form and/or methodology of the survey undertaken by the applicant for the purpose of these proceedings." 3 The affidavit of Mr Gordon referred to directs detailed criticisms at the survey evidence of Eveready which is referred to in the affidavits of Dr Peter Petocz and Patrick Weissenberg. The criticisms focus on the questions and the methodology used in the survey. 4 In the principal proceeding, filed on 6 November 1998, Eveready claims that Gillette Australia Pty Limited ("Gillette") has engaged in misleading and deceptive conduct in breach of ss 51A and 52 of the Trade Practices Act 1974 (Cth) ("the TPA") in the form of misrepresentations and false advertising as to the effective duration of Gillette's "Duracell" batteries. The Further Amended Statement of Claim alleges, for example, a false representation that Duracell batteries last up to four times longer than all types of zinc carbon batteries supplied by Eveready. 5 The matter has been case managed by Lindgren J and is set down for a hearing over a four day period beginning on 1 November 1999. 6 The relief sought includes declarations, injunctive relief, and damages, together with orders under s 87 of the TPA. 7 The matter came before Dowsett J on 3 December 1998 when his Honour dismissed an application for interlocutory relief: see Eveready Australia Pty Limited v Gillette Australia Pty Limited [1998] FCA 1588. In his judgment his Honour said on the issue whether there was a serious question to be tried (at p 4): "Despite my view, I consider that the applicant's argument to the contrary is not unsustainable and may be reinforced by further market research and more detailed analysis of the existing material. The applicant has an arguable case but I do not consider it to be a strong one." 8 In support of its motion to foreclose the use of the evidence of Mr Gordon that is critical of the form and methodology of the Eveready survey, Gillette places reliance on the provisions of Practice Note No 11, which the court expects to be followed in relation to survey evidence. The Practice Note came about as the result of problems experienced by the court in dealing with survey evidence at hearings, which arose from the use of irrelevant and ambiguous questions and unsatisfactory methodology in some surveys. The Note points out that the admissibility of surveys is always a matter for the trial judge to determine, and also points out that the risk of surveys being rejected or given little weight at the trial, may be diminished if the recommended procedure is followed when a party seeks to have a survey conducted. The usual practice which the Court expects to be followed in general terms is that notice should be given by the party seeking to have the survey conducted giving an outline of the purpose of the survey, the issue to which it is directed, its form and methodology, the questions that will be asked, the introductory statements that will be given to participants and other controls. The Note exhorts the parties to attempt to resolve any disagreement concerning the matter and to raise questions concerning the survey with the Court at a directions hearing as soon as possible after the steps have been taken. 9 The applicant also relies on the established case management system adopted by this Court over many years. 10 It is apparent in the present case that the survey evidence could assume an important role in the applicant's case.

Submissions and consideration 18 Eveready first submits that there has been non-compliance with Practice Note 11 by Gillette. Gillette disputes this. Although Gillette submits that notice of objection to the questionnaire was given as early as June 1999, in my opinion, there was no attempt to comply with the Practice Note on the part of Gillette. The generalised indication of opposition expressed in correspondence and at direction hearings does not satisfy the requirements of the Practice Note. It was not until the notification was given in September 1999 that details of the claimed inadequacy were conveyed to Eveready. The course taken by Gillette in ignoring the requirements of the Practice Note is an important matter to be taken into account on costs. 19 Secondly, Eveready claims that if the Practice Note had been followed then the survey could have been recast to satisfy some if not all of the alleged defects. Two consequences were said to follow from this. First, it is said that if the criticisms were accepted by the Court at the final hearing and the objections upheld, the expense of the survey would be thrown away in a situation where it would probably have been capable of remedy. The present limited evidence before me, however, does not satisfy me that Eveready would necessarily have accepted the criticisms and modified the questionnaire or methodology as suggested. Second, Eveready says that it may now have to incur additional costs of a fresh survey which may meet the requirements of the applicants. Again, the evidence does not show that this would be done rather than persist with the existing survey. If it can be shown after exposure of all relevant facts and circumstances at the hearing that the costs have been thrown away as a result of non-compliance with the Practice Note, an appropriate costs order can be made. In addition, if any real prejudice can be demonstrated other than costs, the trial judge can make the necessary orders on a more informed basis than is possible on the sparse material presently before me. 20 The third submission of Eveready is that the exclusion of the evidence of Mr Gordon is warranted by the principles of case management as expressed in, for example, Bomanite Pty Ltd v Slatex Corp Aust Pty Ltd (1991) 32 FCR 379 and Lenijamar Pty Ltd v AGC (Advances) Ltd (1990) 27 FCR 388. There is considerable force in this argument, especially in the present environment where the community expects the court to operate in an expeditious and efficient manner and to take account of the public interest in the orderly administration of the litigation process. However, the circumstances in each case must be closely examined in order to ensure that procedural injustice will not be done by application of case management procedures: see State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146. The facts in that case were somewhat special but the majority opinion pointed out that justice was the paramount consideration and no principle of case management can be allowed to supplant that aim. The amendment in that case was refused by the trial judge on the basis of case management principles and this decision was upheld by a majority of the Full Court. The Full Court decision was reversed by the High Court. 21 In the present case the expert evidence as to methodology and form of the survey is relevant evidence as it bears directly on the weight and the admissibility of the survey into evidence. The survey evidence in the circumstances is important. The applicant seeks to exclude such expert evidence before the hearing has commenced. This evidence, on its face, could be of assistance to the Court in the exercise of its judgment as to the weight to be attached to the survey. A preliminary foreclosure of such evidence calls for cogent evidence which is lacking in the applicant's case on this motion. 22 The Practice Note does not suggest that the consequence of non-compliance will be the exclusion of relevant material. As noted earlier there are several alternatives open to the Court to adjust the interests of the parties with a view to minimising prejudice. These include orders as to costs or the award of costs, together with a discretion to grant an adjournment or re-adjustment of the hearing process on terms imposed by the Court in order to meet any problems arising from non-compliance. In addition, there is nothing to prevent the applicant preparing an affidavit in response to the affidavit of Mr Gordon criticising the survey before the hearing is scheduled to commence in several week's time. 23 The purpose of Practice Note 11 is to minimise costs and hearing time by obtaining an early determination as to the admissibility and form of survey evidence. It is difficult to understand why it was ignored in this case. The Practice Note points out that the admissibility of surveys is a matter for the trial judge to determine but it also foreshadows the risk of the survey being rejected or given little weight in the event of non-compliance. The pre-trial exclusion of the expert evidence is a matter of difficulty in circumstances where the Court has not had the benefit of seeing witnesses and hearing cross-examination. 24 Based on the above circumstances and considerations, I consider that the application in Eveready's motion is premature and should be dismissed, and the costs of the application should be reserved for determination by the trial judge when the hearing has been completed. I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin.

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