Oztech Pty Ltd v Public Trustee of Queensland (No 9) [2016] FCA 785

Introduction 1 The respondent objects to the admission into evidence of the expert reports of: Philip Joseph dated 8 April 2016 (Joseph 1): Exhibit (Voir Dire) 1; Philip Joseph dated 22 April 2016 (Joseph 2): Exhibit (Voir Dire) 2; Philip Joseph dated 22 April 2016 (Joseph 3): Exhibit (Voir Dire) 3; Cosimo Borrelli dated 8 April 2016 (Borrelli 1): Exhibit (Voir Dire) 4; and Cosimo Borrelli dated 22 April 2016 (Borrelli 2): Exhibit (Voir Dire) 5. 2 Mr Joseph is qualified as an expert in the work of corporate trustees. Mr Borrelli is qualified as an investigative accountant. 3 In his written submissions, the respondent submitted that the whole of Borrelli 1 and Borrelli 2 should be excluded because they do not comply with the requirements of s 79(1) of the Evidence Act 1995 (Cth) (the Evidence Act) for the exceptional admission of opinion evidence. Alternatively, the respondent submitted that the whole of Borrelli 1 and Borrelli 2 should be excluded on a discretionary basis under s 135 of the Evidence Act. The respondent submitted that once these reports are excluded, Joseph 1, Joseph 2 and Joseph 3 should be excluded because the essential foundation for the opinions expressed by Mr Joseph will be absent. 4 Apart from this broad submission as to the exclusion of all reports, the respondent objected to certain paragraphs in Borrelli 2 on the basis that they express opinions which exceed Mr Borrelli's specialised knowledge. Similarly, the respondent submitted that certain specific paragraphs in Joseph 1, Joseph 2 and Joseph 3 should be excluded. I will deal with the specific submissions in later paragraphs of these reasons. 5 The respondent's objections were developed extensively in oral argument. I think it is fair to say that the focus of the respondent's oral submissions shifted somewhat from the written submissions. The oral argument was directed to, firstly, the admissibility of Joseph 3 based on Borrelli 2 and, secondly, the absence of a proper factual foundation for the admissibility of Borrelli 1 and Borrelli 2. A very limited objection was made to Joseph 1. No specific objection was addressed to Joseph 2. The respondent's overarching objection to Joseph 1 and Joseph 2 was that if Borrelli 1 and Borrelli 2 were to be rejected, Joseph 1 and Joseph 2 would be irrelevant. 6 As to the first of these matters, the essence of the respondent's argument is that there is a disconformity between the opinions expressed by Mr Joseph in Joseph 3 and the foundation that is purportedly provided for those opinions in Borrelli 2 (the disconformity argument). According to the respondent, the effect of this disconformity is that there is no satisfactory explanation in Joseph 3 of how Mr Joseph's specialised knowledge, on which his opinions purport to be based, has been engaged. The respondent submits that, absent that explanation, the requirements of s 79(1) of the Evidence Act have not been established and the opinions expressed in Joseph 3 are not admissible: Dasreef Pty Limited v Hawchar (2011) 243 CLR 588; [2011] HCA 21 at [37]. 7 As to the second of these matters, the respondent submits that Borrelli 1 and Borrelli 2 proceed on the basis that, on request, the Octaviar Group would have provided documents to an investigative accountant acting on behalf of the respondent and that the investigative accountant would have made a selection from these documents for the purpose of reporting to the respondent. The essence of the respondent's argument is that the applicant has not established, and cannot establish, that the documents provided to Mr Borrelli, for the purposes of making Borrelli 1 and Borrelli 2, fairly approximate or simulate the documents that would have been provided to an investigative accountant investigating the Octaviar Group at the relevant times. Thus, the opinions expressed in Borrelli 1 and Borrelli 2 are inadmissible because the factual foundation for them will not be established (the inadequate proof argument). In oral submissions, this argument was illustrated by reference to Borrelli 2 and the documents and information which, it is said, would have been provided to the investigative accountant in the period August 2007 to January/February 2008. 8 I will elaborate on these arguments below. There are other, related arguments with which I will also deal. 9 The evidence tendered on the voir dire includes the following affidavits: William John Fletcher sworn 20 June 2016; Mark Stephen Sammut sworn 20 June 2016; Anne-Maree Margaret Dunning sworn 22 June 2016; Cosimo Borrelli sworn 27 June 2016 and report (Borrelli 3); and Philip Joseph sworn 1 July 2016 and report (Joseph 4). 10 The applicant tendered the respondent's expert reports that have been filed, namely: Philip David Anthon dated 21 June 2016: Exhibit (Voir Dire) 6; and Michael McCann dated 22 June 2016: Exhibit (Voir Dire) 7. 11 Mr Anthon is the responding expert to Mr Joseph. Mr McCann is the responding expert to Mr Borrelli. 12 The applicant also tendered a folder of documents: Exhibit (Voir Dire) 8. However, I was not taken to these documents. 13 There is a further procedural matter I should mention at this stage. On 2 November 2015, I ordered that the parties' corresponding experts were to confer by 3 June 2016 and, in each case, provide, by 17 June 2016, a joint report identifying the points of disagreement between them and the reasons for that disagreement. For reasons which need not be discussed here, this order was varied on 13 April 2016 to provide that the corresponding experts confer between 15 and 27 June 2016 and provide the required joint reports by 27 June 2016. The order was further varied on 10 June 2016 to provide that the corresponding experts confer by 1 August 2016 and provide the required joint reports by 22 August 2016. The provision of the joint reports, following conferral, is the precursor to the corresponding experts giving evidence concurrently.