FEDERAL COURT OF AUSTRALIA Australian Competition and Consumer Commission v Productivity Partners Pty Ltd (trading as Captain Cook College) (No 1) [2020] FCA 845 File number: NSD 2059 of 2018 Judge: STEWART J Date of judgment: 15 June 2020 Catchwords: EVIDENCE – expert opinion evidence – objection to expert opinion evidence as inadmissible – whether the opinions expressed in the expert report are relevant to any fact in issue – whether the expert brought identified specialised knowledge to bear in formulating opinion – whether process of reasoning disclosed Legislation: Competition and Consumer Act 2010 (Cth), Sch 2, Australian Consumer Law, s 21 Evidence Act 1995 (Cth) ss 55, 76, 79 Cases cited: ACCC v Australian Institute of Professional Education Pty Ltd (in liq) (No 3) [2019] FCA 1982 ACCC v Unique International College Pty Ltd [2017] FCA 727 Dasreef Pty Ltd v Hawchar [2011] HCA 21; 243 CLR 588 HG v The Queen [1999] HCA 2; 197 CLR 414 Honeysett v The Queen [2014] HCA 29; 253 CLR 122 Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 705 Date of hearing: 12 June 2020 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: Regulator and Consumer Protection Category: Catchwords Number of paragraphs: 61 Counsel for the Applicant: K Stern SC with O Bigos SC and S Patterson Solicitor for the Applicant: Johnson Winter & Slattery Counsel for the First and Second Respondents: J Giles SC with R Davies Solicitor for the First and Second Respondents: MinterEllison Counsel for the Fourth Respondent: M Hodge QC with C Schneider Solicitor for the Fourth Respondent: HWL Ebsworth Lawyers ORDERS NSD 2059 of 2018 BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION Applicant AND: PRODUCTIVITY PARTNERS PTY LTD (TRADING AS CAPTAIN COOK COLLEGE) ACN 085 570 547 First Respondent SITE GROUP INTERNATIONAL LTD ACN 003 201 910 Second Respondent BLAKE WILLS Fourth Respondent JUDGE: STEWART J DATE OF ORDER: 15 JUNE 2020 THE COURT ORDERS THAT: 1. The expert report of Jana Scomazzon dated 17 December 2019 and filed on 24 December 2019 is ruled as inadmissible. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT STEWART J: Introduction 1 This is an interlocutory ruling on a challenge to the admissibility of an expert's report that was made during the course of final hearing. In order to understand and decide the challenge it is necessary to identify some key features of the case. 2 The central issue in the case is whether the first respondent, which is a vocational education and training (VET) provider trading as Captain Cook College (the college), engaged in systemic unconscionable conduct in contravention of s 21 of the Australian Consumer Law (ACL) (Sch 2 to the Competition and Consumer Act 2010 (Cth)). The Australian Competition and Consumer Commission (ACCC) alleges that the college breached s 21 of the ACL by changing its enrolment and withdrawal processes for online vocational courses when it knew, or ought to have known, that the changes would have the effect of significantly reducing protections for consumers. It is alleged that the changes were calculated to increase the college's profits by increasing the number of consumers enrolled by the college. 3 In addition to the enrolment process changes, the ACCC alleges that the college unconscionably claimed and/or retained the consequently increased revenue by way of payment from the Commonwealth in respect of VET FEE-HELP (Higher Education Loan Program) debts incurred by consumers. The "claiming and retaining" aspect of the case is not pertinent to consideration of the challenge to the admissibility of the expert report in question. 4 Consumers who enrolled in the college's online courses and satisfied certain criteria were entitled, on application, to a loan from the Commonwealth for a VET unit of study under the VET FEE-HELP assistance scheme run by the Commonwealth. Under the scheme, the Commonwealth loaned the tuition fees (plus a 20% loan fee) to a consumer. The tuition fee component of the loan was paid by the Commonwealth directly to the college in discharge of the consumer's liability to pay fees to the college. 5 When a consumer has income above a threshold (relevantly, around $54,000), the consumer is required to repay the debt through the income tax system. The college, as a VET provider, was required to set a "census date" for each unit of study. The first census date was required to be a date not less than 20% of the way through the period between the commencement date and the completion date for the unit of study. Typically this was two to three weeks after enrolment. If a consumer remained enrolled at the census date, whether or not they had had any actual engagement in the course, they would incur the debt to the Commonwealth and the college would accrue the right to be paid. 6 As other cases have shown (see e.g. ACCC v Unique International College Pty Ltd [2017] FCA 727; ACCC v Australian Institute of Professional Education Pty Ltd (in liq) (No 3) [2019] FCA 1982), the system allowed for the possibility of the enrolment and retention, at least to the first census date, of large numbers of consumers who had no real interest in, or aptitude or suitability for, the courses and who would thus not progress to completion or get anything by way of educational value from the courses. Such consumers would nevertheless incur substantial debts to the Commonwealth, and unscrupulous VET providers could earn very substantial revenue by targeting and/or enrolling students likely to be disengaged from the course for the purpose of not having to provide much or anything by way of instruction to the students in question. Presumably, the minimal provision of instruction would be matched by minimal expenditure, and the revenue would thus represent mostly profit. 7 The second respondent is the parent company of the first respondent, and the fourth respondent is the chief operating officer of the second respondent and was for a period the acting chief executive officer of the first respondent. It is alleged against the second and fourth respondents that they were knowingly concerned in the breaches by the college. The case against the third respondent was settled prior to the final hearing. 8 The ACCC puts its case of unconscionable conduct on the basis that the college had a particular enrolment system in place in what is referred to as the earlier period (i.e. 1 November 2014 to 6 September 2015) and it changed that system in two material respects with effect from 7 September 2015. From the beginning of what is referred to as the relevant period (i.e. 7 September 2015 to 18 December 2015), it is said that those two process changes reduced the ability of the college to mitigate certain risks to consumers with the result that consumers suffered harm. 9 The risks, which it is said that the college knew of, or ought to have known of, are described as "CA misconduct risk" and "unsuitable enrolment risk". 10 The first is the risk of "course advisors" (CAs) (actually, in-field sales agents) misconducting themselves by, amongst other things, making false and misleading statements and otherwise pressurising or tricking students (referred to as "consumers") to enrol in the online courses offered by the college. 11 The second is the risk that CAs would recruit, for enrolment in the online courses, consumers who were unsuitable for enrolment. That unsuitability could be because, for example, they were not "genuine" in that they did not actually wish to enrol, they lacked sufficient language, literacy and numeracy (LLN) or computer skills, or they lacked access to the technology required to undertake online courses and maintain contact with the college. 12 The ACCC alleges that during the earlier period, the college had in place a system for the enrolment of consumers which included the following features which mitigated the risks of CA misconduct and unsuitable enrolment: (1) analysis of the consumer's enrolment form for the purpose of identifying any matter that might affect the consumer's ability to study; (2) analysis of the consumer's pre-enrolment quiz (PEQ) for the purpose of identifying issues with regard to use of or access to a computer and reading, writing or speaking; (3) an outbound quality assurance (QA) call for the purpose of checking whether the consumer was "genuine" – meaning a call made by the college to the consumer after the college had received and had the opportunity to analyse the consumer's enrolment form and PEQ; (4) a campus driven withdrawal (CDWD) process whereby the college would on its own initiative withdraw a consumer from enrolment prior to a census date if, for example, the student had had minimal engagement with the college and the college had not been able to contact the student and confirm their continued commitment to the course. 13 The two process changes at the heart of the unconscionable conduct alleged by the ACCC were the replacement of the outbound QA calls by inbound QA calls and the abolition of the CDWD process. It is said that the inbound calls generally occurred when the CA was present with the consumer and followed a predetermined script which principally consisted of closed questions and the caller conveying information about the course to the consumer. 14 The ACCC says that the process changes reduced the ability of the college to mitigate the CA misconduct and unsuitable enrolment risks by reason of a number of factors. 15 First, the inbound QA call occurred immediately after a consumer's enrolment form and PEQ had been electronically submitted with the result that the college had no, or minimal, opportunity to conduct the analysis of those documents as it had had in the earlier period. 16 Secondly, because the CA was present with the consumer during the call, the CA had the opportunity to prompt the consumer in the answers that they gave and the consumer, under the pressure of the presence of the CA, would be less likely to reveal important information such as that the CA and not the consumer had completed the PEQ or that the consumer had felt pressured to enrol. 17 Thirdly, the scripted nature of the call meant that the ability of the college employee conducting the call to make observations about the consumer's behaviour and listening and speaking skills was reduced. 18 Fourthly, the abolition of CDWDs had the result that if a consumer did not take the affirmative step of requesting withdrawal, subject to a limited discretion, the consumer would pass a census date and thereby incur the debt regardless of whether the college was able to contact the consumer, the consumer was engaging in the online course or the consumer was otherwise not suitable for enrolment. 19 The ACCC says that the college knew or ought to have known that the process changes would reduce the college's ability to mitigate the risks of CA misconduct and unsuitable enrolment in the four respects just identified. 20 The ACCC says that primarily as a result of the process changes, in the relevant period, when compared to the earlier period, there was a substantial increase in the number of enrolments of consumers who incurred a debt but who did not engage in their online course or who were not contactable, and/or who did not complete any unit of competency. There was also a substantial increase in revenue claimed by the college in respect of consumers enrolled in the relevant period, and in the proportion of consumers who made a complaint to the college in respect of the conduct of the CAs. The expert report 21 The ACCC's expert report to which the respondents take objection is that of Jana Scomazzon dated 17 December 2019. The objection is to the whole of the report, but also to specified parts of it in the alternative. The parties all accept that to the extent that that report or any part of it is not admissible, then the corporate respondents' expert report of Claire Field that responds to Ms Scomazzon's report and the report in reply by Ms Scomazzon fall away, either because they will not, to that extent, be relied on or they will not, to that extent, themselves be admissible. The result is that I need deal only with the objections to the one report. 22 Ms Scomazzon's report is challenged on the basis, amongst others, that she lacks relevant or identifiable "specialised knowledge", as referred to in s 79 of the Evidence Act 1995 (Cth). 23 Ms Scomazzon describes her relevant expertise and experience under the heading "Career profile" in her CV as follows: I have worked in vocational education and training (VET) for the past 25 years, and am a recognised expert in regard to: • Training and assessment: Providing training providers with independent advice on improving compliance and delivery and assessment practices • Language literacy and numeracy (LLN): Policy, product, and practice. I have worked in diverse industries and sectors with a range of people (training providers, trainers and assessors, industry regulators, state and federal government, employers, and learners) on projects that have drawn on my expertise in strategic review and evaluation of product and practice, writing and quality assuring online and hard copy VET endorsed and non-endorsed material and resources, facilitating private and public training provider capability building in recruitment, enrolment and delivery practices, teaching English as an Additional Language (EAL) learners, and instructional design. [sic] I specialise in exploring complex client requirements and developing effective evidence-based responses through research, analysis, and consultation. My professional background is varied, including research methodology, psychology, and working as a teaching practitioner in the field of adult literacy. Having undertaken LLN, Australian Core Skills Framework (ACSF), and foundation skills work with training providers, industry regulators, employers, peak bodies, learners, LLN specialists, and vocational trainers and assessors, I have a uniquely diverse and balanced perspective. I have provided learning and development for training providers and their staff, and been a critical friend during the development of, the ACSF and the Core Skills for Work Developmental Framework. I was an invited participant in a small, government roundtable meeting in Canberra that informed the development of the National Foundation Skills Strategy for Adults. I was a founding member of the Industry Skills Council Foundation Skills network in the 1990s, facilitating the network under government funding for a number of years, during which time I liaised with employers to bring to fruition employer briefings that explored workplace LLN and the use of benchmarking frameworks. A former adult literacy practitioner, for the past twelve years I have facilitated learning and development for RTOs and their staff on assessing and meeting LLN and foundation skill support needs, using established frameworks such as the ACSF; developing and unpacking Training Packages; and compliance requirements. My early work as an adult literacy practitioner qualified in adult literacy (Graduate Diploma of Education, majoring in adult literacy [Melbourne University]) helps me convey and discuss language, literacy and numeracy information in an accessible and stakeholder-focused manner. 24 Ms Scomazzon identifies her "Key skills" as follows: • Strategic review and analysis of complex information • Quality assurance and evaluation of VET practice and product • Development and evaluation of language, literacy and numeracy (foundation skill) assessment tools • Training and facilitation • Training product development and design • VET communication strategies • Research and report writing • Client and project stakeholder consultation and relationships 25 The only formal education or training that Ms Scomazzon identifies in her CV is a Graduate Diploma of Education, majoring in adult literacy, from Melbourne University. 26 In the narrative of her report, Ms Scomazzon provides further detail of aspects of her experience, including: (1) reviewing, evaluating and designing LLN tools in the context of registered training organisations (RTOs); (2) 15 years' experience providing advisory services and professional development to RTOs as regards face-to-face and online course delivery; (3) 15 years' experience providing advisory services and professional development to RTOs in regard to identifying and addressing LLN skill levels in pre-enrolment and delivery stages; and (4) three years' of professional development for RTOs following the release, in 2012, of the Australian Core Skills Framework (ACSF), undertaken on behalf of the government, for the purpose of embedding the ACSF into RTO pre-enrolment and training and assessment practices. 27 Ms Scomazzon was asked to answer the following five questions: 1. In respect of each of the Online Courses offered by [the college] during the Earlier Period and the Relevant Period, please: (a) explain the applicable Commonwealth Government Training Package Qualification Rules; and (b) explain the applicable provisions in the Australian Qualifications Framework. 2. In respect of each of the Online Courses offered by [the college] during the Earlier Period and the Relevant Period, and having regard to the delivery mode and duration of the Online Courses, please identify the minimum skills, knowledge and experience a person would ordinarily require in order to successfully complete the course. 3. Please describe what, in your opinion, would be the minimum reasonable steps which a VET provider ought to take, prior to enrolling a person in an Online Course, in order to assess whether that person has the minimum skills, knowledge and experience successfully to complete that Online Courses. Please also identify when any such steps should be taken. 4. In your opinion, was the Pre Enrolment Quiz (considered together with the Enrolment Form) used by [the college] during the Earlier Period sufficient to: (a) identify the person's skills, knowledge and experience; (b) whether the person had the minimum skills, knowledge and experience required in order to successfully to complete the course? 5. In your opinion, was the Pre Enrolment Quiz (considered together with the Enrolment Form) used by [the college] during the Relevant Period adequate to: (a) identify the person's skills, knowledge and experience; (b) whether the person had the minimum skills, knowledge and experience required in order to successfully to complete the course? 28 In the executive summary of her report, Ms Scomazzon summarises her answers to those questions as follows: (1) Q1: After identifying the applicable Commonwealth Government Training Package Qualification Rules for each of the relevant qualifications, as well as the applicable Australian Qualifications Framework (AQF) provisions for those qualifications, Ms Scomazzon concludes that the units of competency offered by the college in each course were in line with the respective qualification's packaging rules. (2) Q2: The online context, coupled with the complex texts and tasks specified in Diploma and Advanced Diploma qualifications, would represent a significant demand on a learner's reading, writing and learning skills as well as on their technology skills. The college appears to have disregarded this. (3) Q3: There are two key reasonable steps that as a minimum a VET provider ought to take prior to enrolling a person in an online course in order to assess whether that person has the minimum skills, knowledge and experience successfully to complete that online course, namely (1) analyse the training package qualification and units of competency being delivered in the course to identify the required skills, knowledge and experience and confirm that prospective learners have those skills, knowledge and experience, and (2) confirm that the prospective learner has the technology skills and resources required to undertake the course. (4) Q4 and Q5: The college's PEQ in both the earlier period and the relevant period did not appear adequate to sufficiently identify prospective learners' existing skills, knowledge and experience or to identify whether people had the minimum skills, knowledge and experience required to complete a Diploma or Advanced Diploma qualification. Principles 29 Section 79 of the Evidence Act sets out an exception to the rule, in s 76, against the admissibility of evidence of an opinion to prove the existence of a fact about the existence of which the opinion is expressed. Section 79(1) establishes two conditions for the admissibility of expert opinion evidence, namely: (1) the person expressing the opinion must have "specialised knowledge" that is "based on the person's training, study or experience"; and (2) the person's opinion must be "wholly or substantially based on that knowledge". See Dasreef Pty Ltd v Hawchar [2011] HCA 21; 243 CLR 588 at [32] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ) and Honeysett v The Queen [2014] HCA 29; 253 CLR 122 at [23]-[24] (French CJ, Kiefel, Bell, Gageler and Keane JJ). 30 "Specialised knowledge" is to be distinguished from matters of 'common knowledge' – specialised knowledge is knowledge which is outside that of persons who have not by training, study or experienced acquired an understanding of the subject matter. It may be of matters that are not of a scientific or technical kind and a person without any formal qualifications may acquire specialised knowledge by experience. See Honeysett at [23]. 31 It is necessary that the expert's evidence explains how their field of "specialised knowledge" in which they are expert by reason of "training, study or experience", and on which the opinion is "wholly or substantially based", applies to the facts assumed or observed so as to produce the opinion that is expressed. That is to say, it must be demonstrated by the way in which the opinion is expressed that it is based on the witness's specialised knowledge; there must be a sufficient connection between the opinion that is expressed and the specialised knowledge. See HG v The Queen [1999] HCA 2; 197 CLR 414 at [39] (Gleeson CJ); Dasreef at [36]-[37] and [42]. 32 It is also necessary that the expert identify the facts, either as proved by the expert or assumed, upon which the opinion is based. See HG at [41] (Gleeson CJ); Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 705 at [64] (Heydon JA); Dasreef at [64] and [101] (Heydon J); Expert Evidence Practice Note (GPN-EXPT) at [5.1] and Annexure A, Harmonised Expert Witness Code of Conduct at cl [3(d)]. 33 In considering the operation of s 79(1), it is necessary to identify why the evidence is relevant: why it is "evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding" (s 55). That requires identification of the fact in issue that the party tendering the evidence asserts the opinion proves or assists in proving. See Dasreef at [31] and Honeysett at [25]. Admissibility Questions 1 and 2 34 The nature of the case and the principal facts in issue are identified in the introductory section to these reasons. There is no fact in issue in respect of which Ms Scomazzon's answers to questions 1 and 2 could possibly be relevant. The applicable Commonwealth Government Training Package Qualification Rules and the applicable provisions in the AQF find no place in the ACCC's case. The same is true of the minimum skills, knowledge and experience a person would ordinarily require in order to successfully complete one of the college's courses. 35 The ACCC submits that Ms Scomazzon's report will assist the Court in understanding the nature of the types of LLN skills and computer skills that a prospective student would require in order to have a chance of successfully completing a diploma level course. Specifically in relation to question 1, it is said that it provides some useful background as to the nature of the qualifications. Specifically in relation to question 2, it is said that the nature of the courses and thus the minimum skills, knowledge and experience required to successfully complete them, is relevant to an assessment of the unsuitable enrolment risk. 36 In my view, those grounds for relevance are too tenuous. It can be accepted that some minimum level of skills, knowledge and experience is required prior to undertaking an online diploma course for a Diploma of Business, a Diploma of Project Management, a Diploma of Human Resources Management or a Diploma of Information Technology – being the four diploma courses offered by the college for enrolment in the relevant period. It can be accepted that that level is not insignificant. The corporate respondents admitted in their defences that there was a risk that some consumers approached by CAs for enrolment in online courses may not be suitable for those courses. The actual level of skills, knowledge and experience required for each course is not relevant. 37 In those circumstances, I reject the report in so far as it states and offers answers to questions 1 and 2. 38 In any event, in relation to question 1, the applicable Commonwealth Government Training Package Qualification Rules and provisions of the AQF can be identified and understood without the need for any specialised knowledge. Ms Scomazzon's answer to the question does not reveal the application of any specialised knowledge. Further, her answers go beyond the question including opining that the units of competency offered by the college in each course were in line with the respective qualification's packaging rules – an opinion that favours the college but is irrelevant to any fact in issue. 39 Also, in relation to question 2, Ms Scomazzon does not identify the minimum skills, knowledge and experience required for each online course. She chooses at random four core units as "exemplars", and in relation to each she identifies a series of "foundation skills". These include reading skills to be able to identify and extract relevant information and gather, interpret and analyse workplace documentation to determine requirements for an operational plan. Another is writing skills to develop and document a range of detailed texts and to ensure that vocabulary, grammatical structures and conventions are appropriate for the context and target audience. Others are oral communication skills and numeracy skills. The identification of these skills in the report does not reveal the application of any specialised knowledge. To the extent that some broad assessment or understanding of the nature of the courses and their demands might form part of the relevant circumstances to the alleged unconscionable conduct, that can be proved by factual evidence about the courses themselves. Question 3 40 It will be recalled that question 3 concerns the identification of the minimum reasonable steps which a VET provider ought to take, prior to enrolling a person in an online course, in order to assess their appropriateness for the course. As shown in the introductory section of these reasons, the allegation of an unconscionable system or pattern is limited to the impact of the two impugned process changes and the "claiming and retaining" of the revenue generated. There is no generalised attack on the college failing to identify, for the purposes of entry into a course, minimum skills, knowledge and experience of the consumers enrolled. The pleaded case is limited to the extent to which the process changes reduced the college's ability to mitigate the risk that unsuitable consumers would be enrolled. 41 The ACCC submits that the answers to question 3 form a "bridge" between the necessary skills, etc., that are identified in question 2 and the particular questions and enquiries made by the college in its PEQs which is the subject of questions 4 and 5. That is also too tenuous a link to make the answers to question 3 relevant – they simply do not relate to any fact in issue. As will be seen when I get to discuss questions 4 and 5, the adequacy of the PEQs is not itself a fact in issue, so something that is merely a "bridge" to the PEQs cannot itself be relevant. 42 In any event, Ms Scomazzon states that in her opinion the minimum reasonable steps that a VET provider ought to take prior to enrolling a learner would be those that ensure that it meets its requirements under the legislated Standards for RTOs with which it must comply in order to be registered as a training organisation. There is no case against the college that it failed to meet those standards, and if there was such a case it would be a matter for the Court rather than for the opinion of an expert to determine whether the standards had been met. 43 Ms Scomazzon identifies that the college was required to have strategies in place that would allow it to provide all clients with training, assessment and support services that meet clients' individual needs and complied with all aspects of the VET Quality Framework. She then says that in her opinion there are two key reasonable steps that as a minimum a VET provider ought to take prior to enrolling a person in an online course in order to assess whether that person has the minimum skills, knowledge and experience to successfully complete that online course. The first step is to analyse the training package qualification and units of competency being delivered in the course to identify the required skills, knowledge and experience and to confirm that the prospective learner has those skills, knowledge and experience. The second is to confirm that the prospective learner has the technology skills and resources required to undertake the course. 44 Ms Scomazzon does not explain why those steps would meet the requirement that she identifies, and in particular why pre-enrolment steps such as she identifies are required by a standard that seeks to provide "clients" with training, assessment and support services – the standard appears to refer to post-enrolment obligations. She also does not identify or explain why she concludes that those are the two necessary reasonable steps. Nor does she reveal what specialised knowledge is brought to bear in reaching that conclusion. 45 For those reasons, Ms Scomazzon's expression of opinion with regard to the two steps is not admissible. 46 The remainder of Ms Scomazzon's answer to question 3 builds on the two steps that she identifies at the outset by seeking to give them content. Since the two steps are not established as being reasonably necessary for a VET provider, the content of those steps lacks foundation with the result that the whole of the answer to question 3 is inadmissible. 47 In the circumstances, I reject the report in so far as it states and offers an answer to question 3. Questions 4 and 5 48 It will be recalled that questions 4 and 5 concern the sufficiency of the PEQs in the earlier period and the relevant period, respectively, to identify the consumer's skills, knowledge and experience and whether they had the minimum skills, knowledge and experience required in order to successfully complete the course. 49 Once again, the sufficiency of the PEQs is not part of the ACCC's pleaded case. The PEQs relate to the first of the complained of process changes, namely the change from an outbound quality assurance call to an inbound quality assurance call. The PEQ is something that was completed by the consumer prior to either of those calls, and the consumer's answers to the PEQ were the subject of the calls. There is, however, nothing about the quality or sufficiency of the PEQ itself that is pleaded against the respondents. 50 However, the corporate respondents in their defences to the allegation that there was an unsuitable enrolment risk pleaded that it had in place processes that it believed would prevent or reduce the unsuitable enrolment risk including, but not limited to, requiring students to undertake the PEQ followed by a quality assurance call prior to enrolment. The ACCC submits that this pleading makes the sufficiency of the PEQs in the respects identified in questions 4 and 5 relevant, directly or indirectly, to a fact in issue. 51 The relevant fact in issue is not the sufficiency or adequacy of the PEQs, but the college's belief that the PEQs taken together with a number of other features of its enrolment system would prevent or reduce the unsuitable enrolment risk. Is the sufficiency or adequacy of the PEQs relevant, directly or indirectly, to the proof of that fact in issue? 52 In that regard, the ACCC submits that the inadequacy of the PEQs is a step which, taken together with as yet unidentified evidence (presumably answers expected or hoped to be extracted in cross examination), can lead to the conclusion that the college's expressed belief was in fact not held or, if held, was not reasonably held because there was no proper basis for it. 53 This is a tenuous basis of relevance in circumstances where the adequacy of the college's PEQ in each time period is not a fact in issue. To admit this evidence as relevant will open up the possibility of an extensive inquiry into the adequacy of the PEQ in each period, which is a far broader inquiry than the college's belief that the PEQ taken together with other measures was adequate. 54 In any event, I accept as valid the respondents' criticism of this part of Ms Scomazzon's report as having relied on standards or criteria that were published in December 2015 and which were thus not current or applicable during either the earlier or the relevant period. 55 In expressing her opinions with regard to the adequacy of the PEQs, Ms Scomazzon uses what she refers to as the Australian Council for Educational Research (ACER) criteria as a benchmark against which she makes the assessment. The ACER criteria are published in a report, Assessment of LLN testing instruments and processes for VET FEE-HELP providers (Australian Council for Educational Research, Report (Stage 2), December 2015). One of the reforms that was announced as a consequence of the report, and which was thus made applicable only after the end of the relevant period, was to introduce a minimum level of LLN competence that prospective learners must meet prior to being accepted into a VET FEE-HELP loan assisted course. 56 Ms Scomazzon explains that the ACER report sets out an approach to establish the minimum LLN levels and was subsequently circulated by the government for use as a reference tool in the evaluation of RTO's LLN assessment tools. She uses this approach to assess the college's PEQs as an LLN assessment tool, but by her own explanation those criteria were not applicable at the relevant time. 57 The ACCC seeks to meet this criticism by submitting that the ACER criteria build upon and utilise assessment according to the ACSF. The ACSF is a framework that was released in 2012 which has been commonly used since then by RTOs to identify learner's LLN strengths and weaknesses. 58 The problem is that the ACER criteria "built upon" the ACSF in unidentified respects, and Ms Scomazzon uses the ACER criteria themselves as her benchmark. She does not explain why that is an appropriate benchmark during the period prior to the publication of those criteria. She merely says that she considers them "to be valid". That is an insufficient exposure of her reasoning. 59 On a further point of criticism, it is not apparent that Ms Scomazzon has brought any specialised knowledge to bear on any process of reasoning to arrive at the conclusions that she expresses with regard to the adequacy of the PEQs. With reference to the ACER criteria she undertakes an assessment of the PEQs, but it is not apparent that the Court is not equally placed to undertake that exercise. That is evident from her failure to identify what specialised knowledge she brought to the task. 60 In the circumstances, I also reject Ms Scomazzon's report in so far as it states and offers answers to questions 4 and 5. Conclusion 61 In the result, the whole of Ms Scomazzon's expert report dated 17 December 2019 and filed on 24 December 2019 is inadmissible. I certify that the preceding sixty-one (61) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Stewart. Associate: Dated: 16 June 2020