Sovereign Motor Inns v Howarth Asia Pacific

Supreme Court of NSW|2003-11-03|Before: Arthur J

CITATION : Sovereign Motor Inns v Howarth Asia Pacific [2003] NSWSC 1120 HEARING DATE(S) : 3 November 2003 JUDGMENT DATE : 4 December 2003 JURISDICTION: Common Law JUDGMENT OF : Master Harrison DECISION : (1) The amended statement of claim filed 3 November 2003 is dismissed; (2) The plaintiff is to pay the defendant's costs of the motion and of the proceedings

CATCHWORDS : Strike out statement of claim - whether witness immunity applies to expert's reports LEGISLATION CITED : Supreme Court Rules - Part 13 r 5, Part 15 r 26 Trde Practices Act 1974 - s 52 Agar v Hyde (2000) 201 CLR 552; [2200] HCA 41 Air Services Australia v Zarb (NSWCA unreported, 26 August 1998) Arthur J S Hall & Co v Simons [2002] 1 AC 615 Baker v Campbell (1983) 49 ALR 385 Bishop v Chung Brothers (1907) 4 CLR 1262 Coco v The Queen (1994) 179 CLR 427 CEO of Customs v Labrador [2003] HCA 49 Cabassi v Vila (1940) 64 CLR 130 CASES CITED : Darker v Chief Constable of West Midlands [2001] 1 AC 435 Dey v Victorian Railways Commissioners (1949) 78 CLR 62 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Jovanovic & Anor v Woods & Ors [2001] TASSC 96 (15 August 2001) Mann v O'Neill (1997) 71 ALJR 903; (1997) 191 CLR 204 Melbourne Corporation v Barry (1992) 31 CLR 175 Pyneboard Pty Limited v Trades Practices Commission (1983) 45 ALR 609 R v Beydoun (1990) 22 NSWLR 256 Stanton v Callaghan [2000] QB 75 Webster & Anor v Lampard (1993) 177 CLR 598 Sovereign Motor Inns Pty Ltd (Plaintiff) PARTIES : Howarth Asia Pacific Pty Limited (Defendant) FILE NUMBER(S) : SC 20010/2003 Mr M Cashion SC with Mr F Donohoe (Plaintiff) COUNSEL : Mr D Davies SC with Mr BM McManus (Defendant) Laurence & Laurence (Plaintiff) SOLICITORS : Colin Biggers & Paisley (Defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

20010/2003 - SOVEREIGN MOTOR INNS PTY LTD v HOWARTH ASIA PACIFIC PTY LIMITED

JUDGMENT (Strike out statement of claim - whether witness immunity applies to expert's reports) 1 MASTER: By notice of motion dated 4 August 2003, the defendant seeks an order that the plaintiff's amended statement of claim filed 3 November 2003 be struck out pursuant to Part 13 r 5 of the Supreme Court Rules (SCR); or in the alternative, that the defendant have leave to withdraw the admission of Item 1 contained in the plaintiff's Notice TO Admit Facts dated 8 March 2003 and the defendant have leave to file and serve an amended defence. The plaintiff relied on the affidavit of Frederick Laws sworn 29 August 2003. The defendant relied on three affidavits of Gopinath Krishnan affirmed 1 August 2003,18 August 2003 and 18 September 2003. 2 I shall refer firstly, to the summary judgment issue; secondly, leave to withdraw admissions and thirdly, the amended defence, depending on the outcome of the first issue.

The law in relation to summary judgment 3 Part 15 r 26 provides: "(1) Where a pleading - (a) discloses no reasonable cause of action or defence or other case appropriate to the nature of the pleading; (b) has a tendency to cause prejudice, embarrassment or delay in the proceedings; or (c) is otherwise an abuse of the process of the Court, the Court may at any stage of the proceedings, on terms, order that the whole or any part of the pleading be struck out. (2) The Court may receive evidence on the hearing of an application for an order under subrule (1)." 4 Part 13 r 5 says: "(1) Where in any proceedings it appears to the Court that in relation to the proceedings generally or in relation to any claim for relief in the proceedings- (a) no reasonable cause of action is disclosed; (b) the proceedings are frivolous or vexatious; or (c) the proceedings are an abuse of the process of the Court, the Court may order that the proceedings be stayed or dismissed generally or in relation to any claim for relief in the proceedings." 5 In Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41 the High Court held at 57 that:

"Ordinarily a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way." 6 According to their Honours, this is because:

"It would be wrong to deny a plaintiff resort to the ordinary processes of a court on the basis of a prediction made at the outset of a proceeding if that prediction is to be made simply on a preponderance of probabilities" (at 58). 7 Similarly, in Air Services Australia v Zarb (NSWCA unreported, 26 August 1998) Rolfe AJA at 13 found it useful to remind himself of the highly demanding test imposed on a party seeking summary judgment. His Honour referred to Dey v Victorian Railways Commissioners (1949) 78 CLR 62; General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 and Webster & Anor v Lampard (1993) 177 CLR 598. I have reproduced some of the passages quoted in Zarb. 8 In General Steel Barwick CJ, who heard the application alone, stated at 130: "Although I can agree with Latham CJ in the same case when he said that the defendant should be saved from the vexation of the continuance of useless and futile proceedings, in my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal. On the other hand I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed." 9 Barwick CJ also said at 129: "It is sufficient for me to say that these cases uniformly adhere to the view that the plaintiff ought not to be denied access to the customary tribunal which deals with actions of the kind he brings, unless his lack of cause of action - if that be the ground on which the Court is invited, as in this case, to exercise its powers of summary dismissal - is clearly demonstrated. The test to be applied has been variously expressed; 'so obviously untenable that it cannot possibly succeed'; 'manifestly groundless'; 'so manifestly faulty that it does not admit of argument'; 'discloses a case which the Court is satisfied cannot succeed'; 'under no possibility can there be a good cause of action'; 'be manifest that to allow them' (the pleadings) 'to stand would involve useless expense'." 10 In Webster Mason CJ, Deane and Dawson JJ reinforced the rigorous testing stating, at 602: "The power to order summary judgment must be exercised with 'exceptional caution' and 'should never be exercised unless it is clear that there is no real question to be tried."' 11 According to Rolfe AJA in Zarb at 15-16: "The demanding nature of the test is in no way lessened in circumstances where there are the potential for difficult factual and legal issues to arise. Rather, as the decision in Webster made clear, it is heightened: see also Wickstead & Ors v Browne (1992) 30 NSWLR 1 and Esanda Finance Corporation Limited v Peat Marwick Hungerfords (1997) 188 CLR 241." The Pleadings - the statutory framework 12 The amended statement of claim (filed 3 November 2003) pleads that the defendant's liability is based upon breach of contract, negligence and breach of the prohibition imposed by s 52 of the Trade Practices Act 1974 (TPA). The plaintiff pleads that the defendant is not entitled to the immunity relied upon by it because firstly, it failed to disclose that it could not prepare a report in accordance with the trial judge's directions. (S/C paragraphs 24(b), 30, 34(c) & 37(a)); secondly, it being aware of the requirement to comply with Schedule "K" of the Supreme Court Rules, knowingly failed to comply with the requirements of Schedule "K". (S/C paragraph 34(b)); thirdly, it did not disclose to Sovereign that the June Report did not comply with the requirements of Schedule "K" (S/C paragraph 37(a)); fourthly, it made deliberately false statements of fact as to the material upon which its report was based and failed to disclose that assertions it made were not based upon facts but were assumptions (S/C paragraphs 16 particulars (a1), (b), (c) & (h), 34(a)). 13 There have been previous equity proceedings (4486/96; 1837/97) and it is an expert who prepared reports and gave evidence in those equity proceedings that is being sued in these current proceedings. By way of background, on 1 September 1991 the plaintiff commenced occupation under lease of a motel located at 220 Pacific Highway, Crows Nest. Sovereign, the lessee commenced proceedings against Bevillesta Pty Ltd, the lessor, based on alleged breaches of the lease. It was alleged that business at the motel had suffered severely as a result of three matters which were said to constitute breaches of the lease: (a) the maintenance of the air-conditioning of the building (air conditioning) (b) the operation of the elevators, and (c) the maintenance of the exterior of the building and the common areas of the building. 14 Initially Sovereign engaged Horwath Asia Pacific Pty Limited (HAP), to provide three expert damages reports as to the effect of the alleged breaches of the lease upon the hotel's occupancy levels. These reports were prepared by Vasso Zographou and Greg Vains who were, respectively, a director and manager at HAP. On 7 May 2001, Austin J delivered a judgment (the liability judgment). Austin J found against Sovereign in relation to two of the claims, namely the elevators and the maintenance but upheld the claim in relation to the air-conditioning. Hence, Sovereign was entitled to recover damages in relation to the air conditioning. 15 At paragraph 142, Austin J held that these damages were to be assessed by the contract measure of damages, and the methodology adopted by Mr Vains was the appropriate methodology. However, as the reports by Mr Vains did not deal separately with breaches arising with respect to the air conditioning plant, His Honour was of the view that the correct approach was to give Sovereign the opportunity to present further evidence along the lines of the reports by Mr Vains, but confined to the air conditioning problems, and to give Bevillesta the opportunity to challenge that evidence and tender, if it wished, an alternative assessment made on the same principles. 16 The fourth report was prepared for Sovereign by HAP dated 8 June 2001 (fourth report) in response to these orders. By this time, Mr Vains had left HAP and was operating a consultancy business, Trusa Pty Limited trading as Hotel Consulting Services (the second defendant). He was engaged by HAP to co-author the fourth report. The earlier reports calculated the losses to total $2,941,000 based on the three causes, the fourth report estimated the losses caused solely by the air-conditioning problems to be $1,960,000. In this fourth report the authors acknowledged in writing that they had been asked to bear in mind that they had an overriding duty to assist the court on matters relevant to their expertise, and although they had been briefed to prepare the report for the plaintiff, they were not advocates for that party. They also acknowledged that their paramount duty was to the court and not the plaintiff and stated that the fourth HAP report was prepared on that basis. (These statements are a reference to the duties of an expert contained in Schedule K). 17 On 23 to 25 October 2001, the matter came on for hearing on the issue of damages before Austin J. At the trial Bevillesta objected to the admissibility of the fourth report and Austin J upheld the objection as to most of the report. Mr Vains was cross examined. Only four pages of the report were tendered. 18 On 23 January 2002, Austin J delivered the damages judgment. His Honour did not accept the quantifications in the fourth report, but held that the approach and the methodology in the first and second reports survived, enabling a re-calculation of the damages to be made. In the ultimate determination, His Honour decided that the proportion of the variants attributable to the air-conditioning problems was 50.01% of the correct total of $2,941,000. The fourth report had quantified the figure and represented the loss as equating to 65.88% of the total loss by HAP to be $2,975,000. 19 Bevillesta appealed from the decisions of Austin J both as to liability and damages (CA 40447/01). The appeal was largely unsuccessful. The judgment of Austin J on liability was upheld, as was His Honour's decision to award damages equal to 50.01% of the total previously identified loss. The Court of Appeal varied the costs order made by Austin J in relation to the damages hearing, ordering Sovereign to pay Bevillesta's costs of those proceedings. 20 Sovereign has now commenced these current proceedings against HAP for damages for alleged negligence associated with the fourth expert report, based on the rejection by Austin J of the fourth report and the evidence of Mr Vains associated with it. As previously stated, the claim is based on breach of contract, negligence, and a breach of s 52 of the TPA. Sovereign seeks the additional damages not recovered before Austin J and recovery of costs it was ordered to pay in relation to the quantum hearing. 21 The critical issue in this application is whether the plaintiff's case as pleaded is one that is recognised as falling within the witness immunity principle. Both parties agree that the starting point in relation to the principle of witness immunity, is the decision of Cabassi v Vila (1940) 64 CLR 130. In Cabassi the plaintiff had sued a person who she claimed assaulted her. A witness, Vila, gave evidence, (together with the defendant and three other witnesses) that she had not been assaulted but had injured herself by jumping from a window. She was unsuccessful in the claim, with the Magistrate believing the defendant, Vila and the other witnesses. She was unsuccessful in an appeal. 22 Subsequently, she brought an action in the Supreme Court against the defendant and two of the witnesses including Vila. Cabassi alleged that the evidence that these persons gave was false and knowingly false, and that they unlawfully conspired to cheat and defraud her and to deceive and fraudulently mislead the Court in the first claim. Vila demurred to the statement of claim, in substance, on the basis that there was no cause of action. Starke, McTiernan and Williams JJ decided that no action is maintainable against a witness in respect of evidence given. Starke J expressed the principle to include evidence prepared, given, adduced or procured in the course of legal proceedings. Starke J said at140-141: "No action lies in respect of evidence given by witnesses in the course of judicial proceedings however false and malicious it may be, any more than it lies against Judges, advocates or parties in respect of words used by them in the course of such proceedings or against juries in respect of their verdicts. …

But it does not matter whether the action is framed as an action for defamation or as an action analogous to an action for malicious prosecution or for deceit or, as in this instance, for combining or conspiring together for the purpose of injuring another; the rule of law is that no action lies against witnesses in respect of evidence prepared ( Watson v McEwan [1905] AC 480 at 486), given, adduced or procured by them in the course of legal proceedings. The law protects witnesses and others, not for their benefit, but for a higher interest, namely, the advancement of public justice ( Seaman v Netherlift (1876) 2CPD 53 at 62; Goffin v Donnelly (1981) 6 QBD 307 at 308) . The remedy against a witness who has given or procured false evidence is by means of the criminal law or by the punitive process of Contempt of Court: see Watson v McEwan ." 23 The rule expressed above has been referred to in English decisions as "the core immunity". The issue is how far the witness immunity rule extends. When this immunity has been challenged, the courts have examined the connection (or proximity) between witness and the court proceedings. 24 The plaintiff submitted that the principles set down by the High Court in Cabassi do not apply because it was a case brought against witnesses for evidence given in earlier proceedings rather than arising out of a report prepared pursuant to a contract by a corporation which was not itself a witness, Cabassi was wrongly decided and the immunity does not apply to a witness who is obliged to comply with Schedule K, in the circumstances where he was unable to provide a calculation of the loss he was obliged to advise Sovereign and the court accordingly and non-compliance with Schedule K far from advancing the administration of justice produces a contrary result. Further, the plaintiff submitted that the witness immunity principle does not apply to the claims under the TPA. The submission that Cabassi was wrongly decided is noted. 25 In R v Beydoun (1990) 22 NSWLR 256 Hunt CJ at CL (with whom Wood and McInerney JJ agreed) stated at 259: "The rule in relation to civil liability has now been applied to statements made (orally or in writing) by witnesses, parties, judicial officers and advocates; a number of the relevant authorities are collected in the judgment of Starke J in Cabassi v Vila (1940) 64 CLR 130 at 140. Notwithstanding an obiter dictum to the contrary over a 100 years ago by Lord Coleridge CJ ( Seaman v Netherclift (at 543)), I am satisfied that the current state of the law is that all such categories may now be regarded as benefiting equally from the Rule. The consequence is that the Rule applies generally, and provided that the statements in question were made in the course of and with reference to judicial proceedings, and even if they were made maliciously, were without justification or excuse, or were irrelevant to every issue in the proceedings in the course of which they were made.

The purpose or rationale of the rule has been variously expressed in the cases, but it is, it seems to me, twofold:

(1) that witnesses, parties, judicial offices and advocates should be free (and should feel free) to make statements in the course of and with reference to judicial proceedings without fear of subsequent harassing or vexatious litigation; and

(2) (perhaps to a lesser extent) that there should be no opportunity for relitigating the same issues by means of subsequent actions." 26 In Mann v O'Neill (1997) 71 ALJR 903; (1997) 191 CLR 204, the High Court (per Brennan CJ, Dawson, Toohey and Gaudron JJ) stated that it is well settled that absolute privilege attaches to all statements made in the course of judicial proceedings, whether made by parties, witnesses, legal representatives, members of the jury or by the judge. It extends to oral statements and to statements in originating process, in pleadings or in other documents produced in evidence or filed in the proceedings. However, in Mann McHugh J, at 221, warned against "the temptation to recognise the availability of the defence for new factual circumstances simply because they are closely analogous to an existing category (or cases within an existing category) without examining the case for recognition in light of the underlying rationale for the defence." I shall refer to the underlying rationale for the defence in relation to expert's evidence and reports later in this judgment. 27 Specifically, in Jovanovic & Anor v Woods & Ors [2001] TASSC 96 (15 August 2001) the court considered whether the immunity extended to the preparation of expert reports. At paragraph 7 Master Holt stated: "The immunity of witnesses is not confined to evidence actually given in Court. It applies even in the early stages where evidence is being prepared or collected for proceedings in contemplation. Darker v Chief Constable (2000) 4 All ER 193. It is the winding up order which is alleged to have caused the damage and accordingly the parts of the report which the plaintiffs seek to impugn must necessarily relate to the proceedings which led to that order. There is no suggestion by the plaintiffs that in producing or presenting the report an administration of justice or associated offence was committed. Accordingly the immunity applies making the negligence claim obviously bad in law. Unlike in Mann v O'Neill (1997) 145 ALR 682 the defendants; contention is not an attempt to extend the immunity or absolute privilege to a new situation. Here the report, as I have said, based on the plaintiffs; allegations and the legislation, must have been prepared in contemplation of the possibility of it being relied upon in court proceedings to wind up the Company. 28 In England in the case of Stanton v Callaghan [2000] QB 75 the Court of Appeal considered whether witness immunity applied to expert reports. At 100, Chadwick LJ stated: "What, then, is the position in relation to expert reports? It seems to me that the following propositions are supported by authority binding in this Court: (i) an expert witness who gives evidence at a trial is immune from suit in respect of anything which he says in court, and that immunity will extend to the contents of the report which he adopts as, or incorporates in, his evidence; (ii) where an expert witness gives evidence at a trial the immunity which he would enjoy in respect of that evidence is not to be circumvented by a suit based on the report itself; and (iii) the immunity does not extend to protect an expert who has been retained to advise as to the merits of a party's claim in litigation from a suit by the party by whom he has been retained in respect of that advice, notwithstanding that it was in contemplation at the time when the advice was given that the expert would be a witness at the trial if that litigation were to proceed. What, as it seems to me, has not been decided by any authority binding in this Court is whether an expert is immune from suit by the party who has retained him in respect of the contents of a report which he prepares for the purpose of exchange prior to trial - say, to comply with directions given under Order 38 rule 37 RSC - in circumstances where he does not, in the event, give evidence at the trial; either because the trial does not take place or because he is not called as a witness." 29 The last exception to which Chadwick LJ referred to is not one which arises here because the trial actually took place, Mr Vains gave evidence and provided expert reports that were tendered in evidence to the court. 30 The House of Lords considered the immunity of advocates from actions in negligence in Arthur J S Hall & Co v Simons [2002] 1 AC 615. In that case, the court unanimously rejected the continuance of the immunity for advocates involved in civil cases. In the course of his judgment, Lord Hoffmann specifically discussed witness immunity and that of experts. His Lordship referred, at 697, to the statement made by Justice McHugh in Mann cited above as a warning against generalising the approach to witness immunity and he then went on to refute the analogy drawn before the court between advocates and expert witnesses. His Lordship said at 698:

"Mr Scott invited your Lordships to apply by analogy the decision of the Court of Appeal in Stanton v Callaghan [2000] QB 75, in which it was held that an expert witness could not be sued for agreeing to a joint experts' statement in terms which the client thought detrimental to his interests. He said that this was an example of a general immunity for acts done in the course of litigation. But that seems to me to fall squarely within traditional witness immunity." 31 One week after the decision in Hall the House of Lords once again considered the immunity of witnesses in Darker v Chief Constable of West Midlands [2001] 1 AC 435. Their Lordships made no reference to Hall though their decision excluded conspiracy to injury and misfeasance in public office from the core immunity. In Darker the plaintiffs brought an action against the chief constable claiming damages for conspiracy to injure and misfeasance in public office after the trial judge in earlier proceedings directed that charges against them be permanently stayed on grounds of abuse of process. The judge struck out the plaintiff's amended statement of claim and dismissed their action as it was held that the amended statement of claim disclosed no reasonable cause of action and this was upheld on appeal to the Court of Appeal. The issue before the House of Lords was whether an absolute immunity attaches to police officers where it is alleged amongst other things that they had fabricated statements against the plaintiffs and conspired to cause them to be charged with offences they knew to be false. 32 The House of Lords reaffirmed that witnesses in a civil or criminal trial have complete immunity from suit including in negligence. It follows that if the plaintiff's claims related to things said or done in the witness box they would be excluded by the core immunity, but these police officers did not enter the witness box. The House of Lords held that the officers were not entitled to immunity as they were found to have deliberately fabricated evidence and the immunity should not be extended in such circumstances. As Lord Clyde said, at 461, what was under attack in the case was not the investigation of "possible realities but the preparation of a fiction."

33 While the law in England in respect of immunity and particularly in relation to advocates, is diverging from our own, it would appear that in England expert evidence still falls within the "traditional witness immunity" as it does in Australia. Thus, on the current trend of English and Australian law the fourth report and Mr Vains' evidence would be subject to witness immunity. 34 Nevertheless, taking the McHugh approach in Mann, I should examine the factual circumstances as pleaded in these proceedings in light of the underlying rationale for the witness immunity principle. The public policy reasons for the immunity are firstly, so as to encourage honest and well meaning persons to assist the higher interest of the advancement of public justice even if a dishonest and malicious person may on occasions benefit from the immunity; secondly, the rule is designed to encourage freedom of speech and communication in judicial proceedings by protecting persons who take part in the judicial process from fear of being sued for something they say; thirdly, to ensure that there is finality to litigation, so there is no opportunity for relitigating the same issues by means of subsequent actions. If the second objective is to be achieved, it would not be satisfactory to confine the immunity to evidence given by witnesses who cannot be confined to the evidence they give while they are actually in the witness box. This is particularly so, in this era of litigation with the increased reliance on the service of statements and reports - see Lord Hope of Craighead in Darker at 447D. 35 In his judgment of 23 January 2002, concerning damages, Austin J noted at [45]-[46] that the criticism levelled at the non-compliance of Mr Vains with the Experts Code of Conduct rested principally upon two grounds. Firstly, His Honour found that some reasoning which Mr Vains articulated in the witness box and some research which he told the Court had been made were not set out in any of the reports. Secondly, the reports did not clearly distinguish between assumption and matters of opinion and they did not make it clear that some opinions that were expressed were unsupported by objective data. However, while His Honour noted that there were "some deficiencies" in the reports he essentially concluded that they were available to be accepted by the Court notwithstanding their "imperfect compliance" with the Code. 36 In reaching an assessment of damages, at [100]-[101], Austin J was critical of Mr Vains' evidence and his fourth report in particular. His Honour said that he derived "no assistance" in an important respect from the fourth report and that "more convincing evidence" might have been adduced. Earlier at [81], His Honour also referred to the little that remained of the plaintiff's evidence in the case that was acceptable following cross-examination and the inadequacy of the fourth report. His Honour felt that the report could have produced more robust conclusions had it more rigorously and clearly applied the methodology of the first two reports. 37 However, His Honour was still prepared to accept the methodology provided in the first two reports and while cross-examination of Mr Vains had undermined the evidence he gave in respect of the fourth report, Austin J noted at [66] that the cross-examination was a "model of the cross-examiner's art" and that Mr Vains had been overawed by counsel. His Honour said at [50] that he would not treat any of the reports as lacking credibility. His Honour specifically rejected, at [65], "as without substance" any assertion that Mr Vains had consciously misled the court or suppressed relevant information. He also added, at [66] that he did not dismiss Mr Vains' evidence as advocate rather than expert. Although unreliable in some respects, Mr Vains' oral and written evidence survived although parts of it were rejected. This should be contrasted with the complete rejection by the court in the liability proceedings of the defendant's alternative methodology and assessment because, as His Honour found, at [134], of a "false premise" upon which it was based. 38 Accordingly, I find that the circumstances pleaded in light of the underlying rationale for witness immunity do not justify divesting Mr Vains of it. As Austin J found, Mr Vains did not mislead the Court. His Honour was of the opinion that the court's task could have been considerably easier if the expert evidence had been more "rigorous" and "helpful", but it did not prevent His Honour from making an assessment of "substantial" damages in the case. 39 If an expert is to adhere to Schedule K, it can be expected that when confronted with that of another expert in the same field's opinion, he or she may make concessions and even change their view. In these circumstances the expert should be able to give his evidence freely and not be in ear of being sued. The rationales of not relitigating the same issues and the higher interest of the advancement of public justice are all applicable.

The Company Issue 40 The plaintiff submitted that because the company provided this report, it is arguable that the company is not covered by the witness immunity. However, it is not clear from amended statement of claim whether or not Mr Vains was employed by HAP. If he was, then his employer HAP is vicariously liable for Mrs Vains' actions. If not, Mr Vains is not liable then his employer cannot be liable.

The Trade Practices Act 41 According to the plaintiff, the defendant has not made a submission as to why the TPA does not apply to the misleading and deceptive conduct involved in the preparation and submission of the June report (S/C paragraphs 24(b), 26 and 30). 42 Section 52(1) of the TPA provides that "A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive." 43 As noted above, at paragraph [65] of the damages judgment Austin J stated that upon the evidence His Honour heard, he did not regard Mr Vains or his co-author as having consciously set out to mislead the court or to suppress the relevant information but it was acknowledged that this does not mean that on that statement alone, the action under s 52 cannot succeed. 44 The defendant's Counsel referred to the authority of Bishop v Chung Brothers (1907) 4 CLR 1262 were at 1273 Barton J stated that it is an ordinary rule of statutory construction that a statute is not read to affect the common law to a greater extent than its expression clearly indicates, for there is no presumption that a statute is intended to override the common law. Similar statements were expressed by Higgins J in Melbourne Corporation v Barry (1992) 31 CLR 174 at 206; Pyneboard Pty Limited v Trades practices Commission (1983) 45 ALR 609 per Mason CJ, Wilson and Dawson at 617; Baker v Campbell (1983) 49 ALR 385 per Deane J at 434 and Dawson J at 439. 45 In Coco v The Queen (1994) 179 CLR 427 Mason CJ, Brennan, Gaudron and McHugh JJ, stated that it would be very rare for general words in a statute to be rendered inoperative or meaningless if no implication of interference with fundamental rights was made, as general words will almost always be able to be given some operation, even if that operation is limited in scope. Or to put it another way, to deprive a person of a fundamental right or privilege recognised by the law, clear legislative provisions are required - per Kirby P, CEO of Customs v Labrador [2003] HCA 49. The TPA cannot be read either by general words or by implication to override the common law principle of witness immunity. 46 It is my view, that in both Australia and England, the law is well settled in relation to an expert witness who provides a report and gives evidence. He or she has an immunity from suit. Thus the plaintiff's proceedings cannot be maintained. The amended statement of claim as currently pleaded discloses no reasonable cause of action and should be dismissed. It cannot be cured by repleading the amended statement of claim. The amended statement of claim is dismissed. It is now not necessary to determine the withdrawal of admissions and the amended defence issues. 47 Costs are discretionary. Normally costs follow the event. The plaintiff is to pay the defendant's costs of this motion and of the proceedings. 48 The Court orders:

(1) The amended statement of claim filed 3 November 2003 is dismissed.

(2) The plaintiff is to pay the defendant's costs of the motion and of the proceedings. **********

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