Land Enviro Corp Pty Limited & Ors v HTT Huntley Heritage Pty Limited & Ors

The first report - relevance 12The HTT defendants contend that, in effect, Dr Ferrier has addressed the wrong question. 13The letter of instruction to Dr Ferrier in relation to the first report stated: - "We consider that in order to determine damages, it will be necessary to assess the value of the old 2001 proceedings. As those proceedings sought a declaration that the whole of the Huntley mine was held on constructive trust for LEC, equitable compensation, an account of profits, compensation under the Corporations Law and damages it will be necessary to assess the value of the business opportunity to develop the Land in order to calculate the value of the cause of action in the 2001 LEC proceedings. Can you please therefore prepare a report for use in the current proceedings which values the business opportunity to develop the land, calculated as at the date of preparation of your report". 14In his report, Dr Ferrier recited the purposes of his report rather differently. He said: - "The purpose of this report is to express my opinion as to the net present value to [HTT] of the cash flows potentially to be derived from the proposed development of a 440 hectare property and HTT located at the Huntley Colliery site NSW... As this report is concerned with the present value of future cash flows associated with the proposed property development, past cash flows and future cash flows not directly associated with the proposed development had been ignored. Thus, the present value calculated in this report is limited to the value to HTT of the proposed property development in its current form". 15Dr Ferrier went on to state that, for the reasons set out his report, his opinion was that the present value of future cash flows potentially derived from the Project was approximately $157.2 million. 16In the third report, Dr Ferrier said, speaking of his two earlier reports: - "None of my reports included the definition of 'fair market value' and I do not assert that my calculations constitute a measure of 'fair market value'. Rather, my calculations are an assessment of the 'value to HTT', which can be interpreted as 'the amount which HTT would reasonably accept if it were to be deprived of the opportunity to undertake the development project'." 17I appreciate that the HTT defendants object to the Court receiving the third report at all. However, I consider I am entitled to have regard to this paragraph as stating Dr Ferrier's understanding of the task he was undertaking in his earlier reports. 18The HTT defendants contend that the damages (if any) suffered by LEC arising from the loss of opportunity to prosecute the 2001 Proceedings fall to be determined at the date when the 2001 Proceedings would have come on for hearing - that is at the "notional date for hearing" of the 2001 Proceedings. 19In support of that proposition they cite Johnson and Others v Perez (1988) 166 CLR 351 at 368; Nikolaou and Another v Papasavas, Phillips & Co (1989) 166 CLR 394 at 403-404; Steve Masselos & Co v Young [2011] NSWCA 352 at [48] - [50]. 20The HTT defendants contend that whilst the precise method of determining the notional trial date of the original action has been variously stated ("... the earliest notional trial date ..." : Johnson at 367; "... the date when the cause of action ... arose" : Nikolaou at 403; " a notional trial date ": Steve Masselos at [49]), on any view, the opinions expressed by Dr Ferrier in his first report do not and can not inform the relevant damages issues in these proceedings. 21This is because, the HTT defendants argue, Dr Ferrier's opinion addresses the question of the present value of future cash flows of the business and, thus, to use Dr Ferrier's language as set out above, the amount which HTT would presently "reasonably accept if it were to be deprived of the opportunity to undertake the development project". 22Mr Einfeld QC, who appears for the HTT defendants, submitted that the relevant question for Dr Ferrier to consider was that posed for his consideration by the plaintiffs' solicitors, namely the value of the business opportunity to develop the Land, but at the notional date for hearing of the 2001 Proceedings (rather than "as at the date of preparation of your report"). 23Mr Jucovic QC, who appears for the plaintiffs, accepted that, assuming the Dismissal Order is not set aside, the date to assess the value of LEC's loss of opportunity to prosecute the 2001 Proceedings is the notional hearing date of those proceedings. 24Nonetheless Mr Jucovic submitted that Dr Ferrier's opinion was capable of being relevant to the issues in the proceedings in three ways. 25First, Mr Jucovic pointed out that part of the relief sought by LEC against HTT in the 2001 Proceedings is an account of profits. 26Although the notional trial date of the 2001 Proceedings was likely to be some time in 2005 or 2006, and although Dr Ferrier's opinion as to the net present value of future cash flows from the Project spoke of cash flows for the years 2011 to 2019, such matters might, it was submitted, cast some light on what order the Court should make regarding an account of profits, as at the notional trial date. 27In any event, Mr Jucovic submitted, the Court should make no final determination of that issue now, during argument as to the admissibility of Dr Ferrier's report, but should determine this issue, along with all other issues, after final submissions. 28Second, Mr Jucovic argued that, whatever may be the case with HTT and Mr Hickie (who are defendants to these proceedings and were also defendants to the 2001 Proceedings), the plaintiffs' damages case against Mr Renshall, Devubo and Vocifa (who were not parties to the 2001 Proceedings) would have to be determined as at the date of hearing of these proceedings. Dr Ferrier's opinion is, it was submitted, relevant to that matter. 29A difficulty with this submission is that on the pleadings, LEC's claims against Mr Renshall, Devubo and Vocifa are, to a large extent, derivative of its claim against HTT. 30Thus the claim against Devubo and Vocifa is that HTT made the relevant representations to the plaintiffs as those companies' agent. One of the claims made against Mr Renshall is that he was "knowingly involved", for the purposes of s 75B of the Trade Practices Act 1974 (Cth), in HTT's misleading or deceptive conduct. 31However it is also alleged, as against Mr Renshall, that he himself made the representations attributed to HTT and did so in breach of an alleged statutory and general law duty and, more significantly, fraudulently. 32In those circumstances, whilst it is difficult to envisage what separate damage the plaintiffs have suffered at the hands of Mr Renshall, Devubo and Vocifa, I cannot conclude, at this stage of the proceedings, that there is no possibility of the plaintiffs making out a separate claim against one or more of these defendants. 33Dr Ferrier's opinion is capable of relevance of such a claim. 34Third, Mr Jucovic submits that part of the damages claimed by the plaintiffs is the loss of value to the second plaintiff, Mr Zdrilic, of a cause of action he claims he has in debt against LEC in relation to moneys advanced by Mr Zdrilic to LEC prior to the commencement of the 2001 Proceedings. 35As I understand the submission, the argument is that the value of that cause of action depends on whether or not LEC is successful in the 2001 Proceedings and that the loss of value to Mr Zdrilic of that cause of action must be determined at the date of the hearing of these proceedings. It is submitted that Dr Ferrier's opinion is capable of relevance to that issue. 36A difficulty with this submission is that there is no claim made in these proceedings for breach of contract. The claims are that misrepresentations were made by HTT and that those misrepresentations induced the plaintiffs to consent to the Dismissal Order and to enter certain agreements. I have difficulty seeing how any difficulty Mr Zdrilic may have recovering the amount he claims LEC owes him could enter the equation. 37Nonetheless, I do not think that I should, at this stage in the proceedings, come to any final view about the relevance of Dr Ferrier's opinion to the pleaded issues. 38Although I have grave misgivings as to its relevance, I cannot conclude, at this stage of the matter, that it is incapable of relevance. 39In any event, because of the conclusions I reach below as to the admissibility of Dr Ferrier's reports, it is not necessary for me to consider this aspect further.

First report - the "proof of assumption rule" 40Dr Ferrier's first report assumes the correctness of certain estimates as to the costs to be incurred in and the revenue to be derived from the Project (the Estimates). 41The HTT defendants submit that the plaintiffs have not adduced admissible evidence to prove the Estimates, and that Dr Ferrier's report is for that reason inadmissible. The HTT defendants rely on the "proof of assumption rule". 42In Dasreef Pty Limited v Hawchar (2011) 243 CLR 588 Heydon J said: - "There is ... no doubt that the proof of assumption rule exists at common law. An expert opinion is not admissible unless evidence has been, or will be, admitted, whether from the expert or from some other source, which is capable of supporting findings of fact which are sufficiently similar to the factual assumptions on which the opinion is stated to be based to render to the opinion of value...(at [66]). The function of the proof of assumption rule is to highlight the irrelevance of expert opinion evidence resting on assumptions not backed by primary materials. It is irrelevant because it stands in a void, unconnected with the issues thrown up by the evidence and the reasoning processes which the trier fact may employ to resolve them. If the expert's conclusion does not have some rational relationship with the facts proved, it is irrelevant. That is because in not tending to establish the conclusion asserted, it lacks probative capacity. Opinion evidence is a bridge between data in the form of primary evidence and a conclusion which cannot be reached without the application of expertise. The bridge cannot stand if the primary evidence end of it does not exist. The expert opinion is then only a misleading jumble, uselessly cluttering up the evidentiary scene..." ([at 90] citations omitted.) 43In Dasreef the plurality, which decided the case on a different basis from Heydon J, expressed no disagreement with Heydon J. 44One of the cases cited with approval by Heydon J was Pownall v Conlan Management Pty Limited (1995) 12 WAR 370. 45In that case, Ipp J said: - "In my opinion, expert opinion based entirely on inadmissible evidence is itself inadmissible and there is no discretion to admit it. I form this view as to admit such an opinion would be to admit, indirectly, the inadmissible evidence itself. If an opinion, based solely on evidence that the Court by law is required to exclude, is itself admitted, the inadmissible evidence would have some influence over the Court's decision. Such a result would defeat the purpose of the law that excludes the inadmissible evidence. If the primary facts on which the evidence is based are not admissible, the opinion is valueless and irrelevant and, in my opinion, it should be excluded". 46These authorities establish that Dr Ferrier's report is not admissible unless evidence is adduced in the proceedings to prove the assumptions he has made - that is, to prove the Estimates. 47Dr Ferrier has made the assumptions on the basis of material contained in reports prepared by TCG Planning ("TCG") by Buchan Consulting ("Buchan"). 48The only basis upon which the plaintiffs seek to prove the Estimates is the tender of the TGC and Buchan reports. The authors of those reports are not called as witnesses in the proceedings. 49The relevant assumptions, and the source of those assumptions in the TCG and Buchan reports are as follows.

That the average cost of construction of residential units on the proposed development would be $450,000 per residential unit 50Dr Ferrier says he has made this assumption on the basis of the TCG report of 10 February 2010. 51In the TCG report of 10 February 2010, the source for this information is stated to be the Buchan report of January 2009. 52In the Buchan report of January 2009, "Housing Construction" cost is stated to be $450,000. No indication is given as to the provenance of that figure.

That the construction cost of the Project as a whole would be $288 million, as set out in the table headed "Construction Costs" on page 6 of Dr Ferrier's report 53Dr Ferrier cites the TCG report of 10 February 2010 and the Buchan report of January 2009 as the basis for his assumption. 54Insofar as the TCG report mentions these costs, it gives as its source the Buchan report. 55The figures are set out in the Buchan report but, again, no indication is given of the provenance of the figures.

That the average selling price of the residential units would be $1.1 million, consisting of $650,000 land component and $450,000 building component 56Dr Ferrier gives as the source of this information the Buchan report of January 2009. The Buchan report states: - "Average land cost in 2009 is $650,000. Average construction cost in 2010 is $450,000". 57The Buchan report gives no explanation as to the provenance of these figures. One (land costs) purports to be a current figure. The other (construction costs) is plainly a prediction.

That the pre-tax operating cash flow of the golf club would be $520,000 per annum and that its capital value could be reasonably estimated at $1.5 million 58Dr Ferrier states that he has made this assumption on the basis of the TCG report of November 2007. 59The TCG report repeats an "analysis" said to have been made in the Buchan report of 6 August 2006. The relevant part of that report is not in evidence. 60The TCG report includes a table said to summarise the Buchan 6 August 2009 "analysis". That table refers to "net revenue before interest" of $521,000 but makes it clear that that figure is based upon a large number of assumptions concerning such matters as membership fees received, pro-shop revenue received and particular levels of employment. The basis upon which those assumptions are made is not revealed.

That the annual EBIT of the hotel development on the Land would be $2.2 million 61Dr Ferrier cites as the source of this assumption the TCG report of November 2007. 62Again, the TCG report refers to the Buchan 6 August 2006 report which recites a figure of "room operations gross profit before interest" of $2.5 million and "F&B gross profit before interest" of $273,000. 63It appears that Dr Ferrier has adopted these two figures to come to his assumption of an EBIT of $2.7 million.

What is the nature of the Estimates? 64Mr Jucovic submits that the Estimates are simply statements of fact, namely that someone has made the relevant estimate. 65At one level, this may be accepted. Whether someone made the relevant Estimate is a question of fact. 66But the Estimates address something that is to occur in the future; whether certain costs will be incurred or revenue derived in the Project. 67They are either no more than assumptions that someone has made about those matters, or opinions that someone has formed, on some basis, about those matters. 68If the Estimates are no more than assumptions, Dr Ferrier's report is of no probative value whatever as, in that circumstance, his report is based on assumptions of assumptions. 69On my reading of the TCG and Buchan reports, their authors did not record the Estimates as mere assumptions. In my opinion, the authors of those reports intended to assert that the Estimates were a prediction, that is an opinion, formed by someone as to what the costs and revenue of the Project would be. 70It seems plain to me that that is how Dr Ferrier treated the reports. Dr Ferrier has assumed the correctness of the Estimates. That is, he has assumed that the various costs and revenue, as set out in the Estimates, will come to pass. It is only on that basis that his report could be of probative value. 71In my opinion, I should treat the Estimates as opinions. 72It follows, that in order to satisfy the "proof of assumption" rule, the plaintiffs must prove that those opinions are evidence of the facts opined.

Who formed the opinions constituted by the Estimates? 73It appears that the author of the TCG reports is one or both of Ms Nadine Paige ("Ms Paige") and Ms Elaine Treglown ("Ms Treglown"). There is no evidence as to the qualifications of either Ms Paige or Ms Treglown. TCG describes itself as an organisation concerned with "Planning Environment Urban Design" from which I would infer that Ms Paige and Ms Treglown are town planners. 74There is also no evidence as to who is the author of the Buchan report. Oral submissions proceeded on the basis the author was a Mr Buchan. His reports describe his business as "Business, Strategy, Communications, Public Policy" from which I would infer that Mr Buchan is some kind of business strategist. 75The authors of those reports do not profess to, and do not appear to have qualifications in a relevant field of expertise (for example as a quantity surveyor or cost estimator) such as would permit the expression of expert opinion as to the estimates and calculations the subject of Dr Ferrier's assumptions. 76The authors of the TCG and Buchan reports do not assert, in their reports that they have made the projections and estimates that they recite in their reports. Nor do they specify the provenance of the figures. The figures are simply recited. 77Indeed, in a disclaimer to his report of January 2009, Mr Buchan said: - "This report (including appendices) is based on estimates, assumptions and information sourced and referenced by Buchan Consulting. These estimates, assumptions and projections are provided as a basis for the reader's interpretation and analysis. In the case of projections, they are not presented as results that will actually be achieved. The report has been prepared on the basis of information available at the time of writing. While all possible care has been taken by the authors in preparing the report, no responsibility can be undertaken for errors or inaccuracies that may be in the data used". 78It is clear, as Mr Jucovic accepts, that the information in the TGC reports is derived from that in the Buchan reports. Thus, this disclaimer effectively qualifies the TGC reports, as well as the Buchan reports. 79Mr Renshall was unable to take the matter further. 80In his affidavit evidence, Mr Renshall said: - "I do not know the exact basis of the indicative figures for construction costs and sale prices of residential properties referred to in the TCG and Buchan reports...No detailed designs or costings have ever been prepared by Huntley in respect of any future residential development". 81In cross-examination Mr Renshall gave this evidence: - Q: "And you provided Ms Treglown and TCG planning during the course of your involvement with them with whatever information are required?" A: "Yes - I qualify that, to best of our knowledge..." Q: "And you provided to Buchan Consulting, to the extent you could, the information they required?" A: "We supplied them with some information. They used their own resources."

82Thus there is no evidence as to who formed the opinions constituted by the Estimates, nor of the basis on which such opinions were formed.

The bases advanced by the plaintiffs to prove the Estimates 83The statements made in the TCG and Buchan reports about the Estimates are hearsay. 84The plaintiffs submit that nonetheless those statements are admissible on two bases. 85First, the plaintiffs submit that the TCG and Buchan reports are business records of HTT and that the hearsay rule does not apply to the relevant statements. 86Second, the plaintiffs submit that by forwarding the TCG and Buchan reports to the New South Wales planning authorities, HTT has made a representation adverse to its interests in these proceedings and has thus made an admission sufficient to prove the Estimates.

The business records argument 87The plaintiffs submit that the TCG and Buchan reports are business records of HTT and that the statements made in those reports concerning the figures upon which Dr Ferrier has relied are receivable as evidence sufficient to provide a basis for the admissibility of Dr Ferrier's opinion. 88The business records exception to the hearsay rule is set out in s 69 of the Evidence Act 1995 (the Act) which, relevantly, provides as follows: "(1) This section applies to a document that: (a) either: (i) is or forms part of the records belonging to or kept by a person, body or organisation in the course of, or for the purposes of, a business, or (ii) at any time was or formed part of such a record, and (b) contains a previous representation made or recorded in the document in the course of, or for the purposes of, the business. (2) The hearsay rule does not apply to the document (so far as it contains the representation) if the representation was made: (a) by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact, or (b) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact... (5) For the purposes of this section, a person is taken to have had personal knowledge of a fact if the person's knowledge of the fact was or might reasonably be supposed to have been based on what the person saw, heard or otherwise perceived (other than a previous representation made by a person about the fact)." 89For the purpose of s 69(1) of the Act, Mr Einfeld accepts that the TCG and Buchan reports form part of the business records of HTT. Indeed, as Mr Jucovic pointed out, HTT discovered those documents in these proceedings. 90However, as the High Court recently pointed out in Lithgow City Council v Jackson [2011] HCA 36; (2011) 281 ALR 223: - "... s 69 does not render business records as such admissible. It concerns representations in a document which is or forms part of a business record within the meaning of s 69(1). The representations are admissible if s 69(2) is satisfied". 91In my opinion the requirements of s 69(2) are not satisfied. 92So far as concerns s 69(2)(a), that subsection is only enlivened if it might reasonably be supposed that the authors of the TCG and Buchan reports had "personal knowledge" of the "asserted facts" in the report. 93In this regard it seems to me that the expression "asserted fact" must have the same meaning as the "fact that it can reasonably supposed that the person intended to assert" in s 59(1) which, in this case, is the correctness of the opinions comprised in the Estimates. 94By reason of s 69(5) the author of the reports will be taken to have personal knowledge of the relevant matters if the person's knowledge was or might reasonably be supposed to have been based upon what the person saw, heard or otherwise perceived. 95The current state of authorities is that, for the purposes of s 69 of the Act, "asserted facts" include an opinion in relation to a matter of fact: eg Ringrow Pty Ltd v BP Australia Ltd [2003] FCA 933, (2003) 120 FCR 569 per Hely J; Investmentsource Corp Pty Ltd v Knox Street Apartments Pty Ltd [2007] NSWSC 1128 per McDougall J at [19] - [21]; Street v Luna Park Sydney Pty Ltd [2007] NSWSC 688 per Brereton J; cf Lithgow City Council v Jackson (supra) at [17] where the logic of the proposition was doubted but not rejected. 96Assuming the "asserted facts" here are the opinions comprised by the Estimates, then in order for a person to have "personal knowledge" of such matters, it would be necessary for such person to have "formed or expressed" the opinions in question; e.g. Ringrow at [19]. 97In my opinion s 69(2)(a) is not enlivened by the circumstances of this case. This is because it could not reasonably be supposed that the authors of the TCG and Buchan reports had personal knowledge of the relevant "asserted facts". 98The author of the TCG report did no more than repeat the contents of earlier Buchan reports. The author of the Buchan report does not assert personal knowledge of the relevant matters and indeed, by the disclaimer to which I have referred above, eschews such personal knowledge. 99Subsection 69(2)(b) is only enlivened if it can be reasonably supposed that the authors of the TCG and Buchan reports represented the asserted facts on the basis of information supplied to them directly or indirectly by a person who did have personal knowledge of those asserted facts. 100The author of the TCG report obtained the information from Buchan. But Buchan obtained the information "based on estimates, assumptions and information sourced and referenced" by it. From who such "estimates, assumptions and information" were "sourced or referenced" is not revealed by the evidence. 101As I have set out above, Mr Renshall said he did not know "the exact basis" of the "indicative figures for construction costs and sale prices of residential properties" referred to in the reports. Although he said in cross-examination that "we supplied them with some information" he also said that Buchan "used their own resources" and, in his affidavit evidence, that "no detailed designs or costings have ever been prepared by Huntley in respect of any future residential development". 102Presumably, the author of the Buchan reports did not make them up. But I am not able to draw any conclusion as to where the information came from, or whether the information came from someone with the relevant "personal knowledge". 103Accordingly, s 69(2)(a) has not been enlivened. 104My conclusion is that the relevant material remains hearsay and should not be admitted. 105In any event, because the Estimates are matters of opinion, by reason of s 76 of the Act, they are not admissible unless it is established that the opinion was formed by a person with a kind of specialised knowledge referred to in s 79 of the Act. 106This is made clear by Lithgow City Council v Jackson in which it was held that a statement of opinion in a business record must comply with ss 76 to 79 of the Act. The High Court said (at [18] to [21] per French CJ, Heydon and Bell JJ): - "The question is whether a statement of opinion in a business record has to comply with ss 76-79... ...s 69(2) does not provide that the evidence [in a business record] is admissible. It is only admissible if no other exclusionary rule applies... ...the evils of opinion evidence which have resulted in its prohibition by s76(1) unless there is compliance with the specific requirements of ss77-79 are just as great when the evidence appears in hearsay representations as where it is given through witness testimony. If opinion evidence which is inadmissible when elicited through questions to a witness were admissible if it appeared in the hearsay representation, a bizarre premium will be placed on calling hearsay evidence in preference to direct evidence. If there are inconveniences, they are necessary inconveniences, and they are not so acute as to compel a construction to the contrary of what the clear words suggest". 107There is no evidence as to who formed the opinion comprised by the Estimates, let alone any evidence that such person had "specialised knowledge based on the person's training, study or experience" for the purposes of s 79 of the Act. 108Accordingly, even if the representations in the TCG and Buchan reports do not fall foul of the hearsay rule, they are excluded by the opinion rule.

The admissions argument 109Section 81 of the Act provides that the hearsay rule and the opinion rule do not apply to admissions. 110"Admission" is defined in the Dictionary to the Act as a previous representation made by a party to proceedings that is "adverse to the person's interests in the proceedings". 111"Representation" is defined in the Dictionary to include an implied representation or one to be inferred from conduct. 112Clearly enough, when the TCG and Buchan reports were prepared, the statements made in them about the Estimates were not statements made "by" HTT. At that time, they were representations made "to" HTT. 113However, Mr Jucovic points to evidence which establishes that after the TCG and Buchan reports were prepared, HTT submitted the reports to New South Wales state government planning authorities. 114Mr Jucovic submitted: "We have here reports which came about as a result of meetings with two relevant Ministers, Mr Sartor and Ms Keneally. The former report was sought by Mr Sartor and provided to him. The latter report was provided to Ms Keneally after a representation [about the Project] ...and resulted in affirmative action on the part of the [HTT]. This is either an express representation, or implied representations, or representation to be inferred from conduct on the part of Huntley ... " 115Mr Jucovic submitted that the information in the TCG and Buchan reports was given to the planning authorities "as Huntley's information....this is Huntley putting forward these costs as its costs". 116Furthermore, Mr Jucovic submitted that HTT thereby made a representation to the planning authorities which was adverse to HTT's interests in that it is now deployed against HTT by the plaintiffs' expert witness, Dr Ferrier. 117I accept that, by submitting the TCG and Buchan reports to the planning authorities, HTT adopted the contents of those reports. 118However, the question arises as to what it was that HTT was representing to the planning authorities by its submission to them of these reports. Any admission thereby made by HTT cannot rise higher than such representation. 119I accept that, by submitting these reports, HTT was submitting that the reports were "true" or "accurate". But what does that mean, so as concerns the Estimates? 120The Estimates speak of matters to occur in the future. They are a prediction, an opinion as to what the costs and revenue of the Project will be. 121It was Mr Renshall that had the discussions with Ministers Sartor and Kenneally that led to the TCG and Buchan reports being submitted to the planning authorities. 122As appears above, Mr Renshall's evidence in these proceedings is that he regarded the figures in the reports as merely "indicative", that he did not know the "exact basis" of the figures and that HTT had never prepared any "detailed designs or costs" for the Project. 123In light of that evidence, and looking at the form of the reports (including Mr Buchan's disclaimer, referred to above), my opinion is that by submitting the Estimates to the planning authorities HTT was representing no more than that it believed the Estimates to be correct. 124In my opinion, HTT was not thereby representing to the planning authorities that, as a matter of fact, the Estimates were correct. Indeed, I find it hard to see how HTT could have made such a representation. 125Nor, in my opinion, was HTT representing that the Estimates were the product of appropriate expert consideration and analysis. No such consideration or analysis is referred to in the reports. Indeed, as I have said, the reports made it clear that the TCG reports repeated and relied on the figures in the Buchan reports and that Buchan, by its disclaimer, eschewed responsibility for such analysis as led to the making of the Estimates. 126If HTT has thereby made an admission, it is no more than that it had that belief at that time. 127I accept Mr Einfeld's submission that this was not an admission sufficient to provide an evidentiary foundation for the assumptions made by Dr Ferrier. Dr Ferrier has assumed that the costs and revenue from the project would, as a matter of fact, be as predicted in the Estimates. The material Dr Ferrier has relied on does make good that assumption. There is no other material before the Court relevant to the issue. 128It follows that the plaintiffs have failed to prove the factual assumptions underlying Dr Ferrier's first report and that, accordingly, that report, and thus the second report, and the relevant part of the third report, are not admissible and should be rejected. 129In those circumstances, I need not consider Mr Einfeld's further submission concerning Uniform Civil Procedure Rules (UCPR) r. 31.23.

Dr Ferrier's third report 130The third report is dated 23 February 2012 - that is, on the fourteenth day of the hearing. It was provided to the Court on 24 February 2012 - that is, on the fifteenth day of the hearing. Leave to serve this report has not been granted. 131The explanation given as to the delay in service of this report is that Mr Sellers' affidavit is dated 22 December 2012 and was served on or about that day, and that HTT's financial records for the financial years ended 30 June 2010 and 2011 were only made available in early February this year. 132In his third report, Dr Ferrier seeks to express an opinion as to: - "...whether the affidavit of Mr Ian Sellers sworn 22 December 2011 and the HTT Financial Statements for the two years ended 30 June 2011 are evidence of the following propositions: - (i) it has cost HTT $11,649,412.58 to achieve its current net asset position as recorded in the HTT 2011 financial statements; (ii) an appropriate method of assessing HTT's profit since acquiring the land is to deduct $11,649,412.58 from its net assets of $28,192,234.00 as recorded in the HTT 2011 financial statement." 133Dr Ferrier goes on to express opinions as to the net trading loss HTT incurred to achieve its net asset position at a particular time and as to "an appropriate method" of assessing HTT's "gain" since acquiring the Land. 134The HTT defendants submit that Dr Ferrier's opinions do not relate or explain conclusions already expressed and that, rather, Dr Ferrier has embarked upon a new and different endeavour in providing expert opinion as to matters not hitherto addressed. 135Mr Sellers is, and has been since 2000, HTT's accountant. Since that time he has prepared HTT's general ledger, annual financial statements and income tax returns. 136His affidavit does no more than explain the process whereby he prepared these documents, annex a spreadsheet summarising the general ledger for each financial year since 2000 and providing an explanation as to the meaning of various expressions used in the general ledger. 137Otherwise than in relation to the 2010 and 2011 financial years, Mr Sellers' spreadsheet summarises financial information already available to the plaintiffs in the proceedings. 138The opinions expressed by Dr Ferrier are ones he expresses for the first time. He is not updating an earlier opinion based on recently received information. His report is not responsive to any opinion expressed by Mr Sellers. 139Further, as Mr Jucovic accepted during argument, the observations Dr Ferrier makes are ones that could properly be made in submissions on the basis of the existing evidence. 140It is served late, and raises new matters. If it were admitted into evidence, the HTT defendants would, during what is now the fifth week of the hearing, have to engage an expert to reply to it. Although Mr Einfeld said he could not point to prejudice beyond this, I do not think it reasonable to require the HTT defendants to do this at this point in the trial. 141In those circumstances I am not prepared to grant the plaintiffs leave to rely on Dr Ferrier's third report.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 06 March 2012