LMI v Baulderstone

7 THE SUPREME COURT REVISED OF NEW SOUTH WALES EQUITY DIVISION COMMERCIAL LIST

TUESDAY 14 AUGUST 2001 50023/00 - LMI AUSTRALASIA PTY LIMITED & ANOR v BAULDERSTONE HORNIBROOK PTY LIMITED & ORS JUDGMENT - On objection to paragraph 33 of the statement of Steven Wise dated 12 April 2001 (see p 79 of transcript) HIS HONOUR: 1 The plaintiffs objected to a passage in the witness statement of Mr Wise proposed to be tendered by the defendants, saying that it is bad in form and therefore inadmissible. The passage in question (paragraph 33) records in indirect speech a conversation to which the witness was party. It begins: "Although I cannot remember the specific terms of the conversation that I had with McGee at the time, in substance I told him that I stated that the consortium was prepared to negotiate along the following lines."

There then follow paragraphs (a) to (c) which set out those "following lines". 2 Mr Campbell QC, senior counsel for the defendants, said that there is no rule of law which makes inadmissible a report of a conversation which is not couched in direct speech of the "I said/he said" type recording the witness's recollection of the precise words spoken by each party. Mr Campbell supported this submission by reference to a passage in the joint judgment of the Full Federal Court (Smithers, Sheppard and Wilcox JJ) in Commonwealth v Riley (1984) 5 FCR 8: "The rule that evidence of conversations shall be given in direct speech is, in Australia, a rule of practice rather than a rule of law, a practice that is probably now disregarded as often as it is followed."

3 Mr Campbell also referred me to two decisions of the Court of Criminal Appeal of Queensland, namely Wright (1985) 19 ACrimR 17 and R v Noble [2000] QCA 523. Wright concerned oral evidence given by a police surgeon, Dr Jappie, of her conversation with the accused. The judgment of the Court (Mathews, McPherson and Vasta JJ) contains the following relevant passage: "She remembered being told that the accused had spoken of her husband being 'shot before me' or 'shot before my eyes'. In that sense, Dr Jappie was unable, as she herself conceded, to recall what words were used. It might have been one version or the other, or perhaps another version; but she could, as her testimony shows, recollect the effect of what was said. There is no doubt that a witness may properly give in evidence the effect or purport or substance of what was said to him even though unable to recollect the precise verbiage used. The present case is stronger than many instances of its kind because Dr Jappie was able to identify precise words that, with one or more slight verbal differences, conveyed the effect or impression of what was said." 4 In Noble's case the trial judge had insisted that a witness giving oral evidence should relate conversations in direct speech. On appeal, Pincus JA, with whom Mackenzie J agreed, said: "There is, in my respectful opinion, no rule that a witness who does not claim to remember the words spoken in a conversation must attempt to give it in direct speech, manufacturing a conversation from a recollection of its effect. Of course, the ideal is that the exact words be given, but it is so unlikely that Barry could have remembered anything other than the substance of the conversations that the judge erred in attempting to have him give evidence using direct speech. The erroneous idea that people can accurately recall conversations in direct speech, long after their occurrence, appears to have been encouraged by practices observed by some magistrates and police, in days gone by. That it is erroneous can easily be demonstrated, if one tries to perform this feat oneself."

5 Against that general law background, Mr Campbell went to the Evidence Act 1995. He referred to the central provisions in ss.55 and 56 to the effect that evidence which could rationally affect the probability of a fact in issue is admissible, subject only to the exclusionary rules in subsequent parts of the Act including, ultimately, the rule in s.135 under which the court has a limited discretion to exclude evidence. Unless some provision of the Act makes a particular statement inadmissible, he said, it is admissible subject only to the possible operation of the s.135 discretion. 6 Mr Weber, who, with Mr Sullivan QC, appears for the plaintiffs, submitted that s.29 of the Act has a bearing on this matter. He pointed to s.29(2) which says that a witness may give evidence in narrative form only if a special direction to that effect is made by the court, thus confirming that evidence should not normally be in narrative form. He took me to the decision of the present Chief Judge in Equity in Ramirez v Sandor's Trustee (NSWSC, unreported, 22 April 1997). But in that case his Honour held that s.29(2) only applies where the evidence in question is to be given orally. With respect, I agree with Young J that s.29(2) has no bearing upon a case where the relevant evidence is in an affidavit. I have no doubt that the position is the same where, as here, the evidence is to be given by statement which the witness affirms in a compendious way at the start of his testimony. 7 The meaning of "narrative form" is discussed at paragraph 29.3 of the fourth edition of Mr Odgers' book "Uniform Evidence Law" by reference to an extract from the relevant report of the Australian Law Reform Commission. It is also referred to at paragraph 3245.2 of Ritchie's "Supreme Court Procedure NSW". Both sources show reasonably clearly, I think, that "narrative form" is used in contradistinction to the familiar process by which a witness giving oral evidence is asked questions and the witness's evidence takes the form of the answers given to those questions. "Narrative form" refers to the situation where a witness stands in the witness box and speaks without being questioned. Section 29(2) does not apply to and is of no assistance in the present case. 8 There is no rule of law, whether under the Evidence Act or otherwise, which makes inadmissible evidence of a conversation given in indirect speech, but there are obviously very good reasons why courts have, over the years, been astute to regard the direct speech form as the best form. The statements in the two Queensland cases to which Mr Campbell took me share a common thread of the witness's inability to remember the precise words used. In each of the passages I have quoted there is a statement that the witness was unable to remember the precise words. Obviously if a witness can remember them, evidence should be given of the ipsissima verba. 9 The possibility that s.135 may be invoked where evidence of a conversation is given in indirect speech is, of course, real. However, the question under that section will be not merely be whether there is prejudice, but whether that prejudice is unfair prejudice operating against the opposing party because of a curtailment of the ability to cross-examine. I accept that not all the cross-examination opportunities available in a case of direct speech report will arise in case of an indirect speech report, but the ability to engage in meaningful cross-examination will exist nevertheless. There is also the point that the probative value of the evidence may be diminished by its form. 10 In the end, I think all this comes down not to a question of the admissibility of evidence but to the way in which evidence might most appropriately be tendered or adduced. Part 36 r 2 of the Supreme Court Rules reflects a general expectation that evidence will be given viva voce, an expectation very much modified in this Division and modified in a particular way in the Commercial List (Part 36 r 4A and Practice Note 100). However, the primary means based on oral testimony may usefully be resorted to where there are reservations about evidence in affidavit or statement form and where the opportunity can be taken test the witness on whether or not a conversation can be related in direct speech, even if in part only. As Wright shows, it may be useful to have some part of the actual words used, even if the witness cannot remember them all and must resort to descriptive recollection as to the balance. 11 Mr Wise will give oral evidence. Indeed, he must do so if his witness statement is to be put in evidence: Part 36 r 4A(2). The desirable course, therefore, is that the present controversy be resolved by giving leave to the defendants to adduce oral evidence from Mr Wise on the matter covered by the passage in the statement to which objection has been taken. I do not say that that should invariably be done where an affidavit or witness statement reports a conversation in indirect speech; but it is the desirable course here where the conversation concerned plays an important role in the case and the objection has been conscientiously taken. 12 Subject to anything further that counsel may have to say, I propose to give leave to the defendant accordingly, and to decline to allow paragraph 33 of Mr Wise's statement to be read.

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