Land and Environment Court of New South Wales CITATION : Halley v Minister Administering the Environmental Planning and Assessment Act 1979 [2009] NSWLEC 209 APPLICANT: Diane Kay Halley PARTIES : RESPONDENT: Minister Administering the Environmental Planning and Assessment Act 1979 FILE NUMBER(S) : 31077 of 2008 CORAM: Biscoe J KEY ISSUES: PRACTICE AND PROCEDURE :- application under UCPR r 31.28(3) for leave to rely on expert reports - reports not served within the time required by the Court's directions, other party unable to respond before the hearing dates - application to vacate hearing dates. Civil Procedure Act 2005, ss 56 - 60 LEGISLATION CITED: Land Acquisition (Just Terms) Compensation Act 1991 Uniform Civil Procedure Rules 2005 r 31.28 CASES CITED: Aon Risk Services Australia Limited v Australian National University [2009] HCA 27, (2009) 83 ALJR 951 Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority [2009] NSWCA 178, (2009) 168 LGERA 1 DATES OF HEARING: 3 December 2009 EX TEMPORE JUDGMENT DATE : 3 December 2009 APPLICANT: Mr T Hale SC with Mr J Kildea SOLICITORS: Bradfield & Scott LEGAL REPRESENTATIVES: RESPONDENT: Mr R Lancaster SC with Mr L Livingston SOLICITORS: Pikes Lawyers JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES BISCOE J 3 December 2009 31077 of 2008 DIANE KAY HALLEY v MINISTER ADMINISTERING THE ENVIRONMENTAL PLANNING & ASSESSMENT ACT 1979 EXTEMPORE JUDGMENT INTRODUCTION 1 HIS HONOUR: These proceedings are for determination of compensation under the Land Acquisition (Just Terms) Compensation Act 1991 arising out of the compulsory acquisition of the applicant's land by the respondent in 2008. The applicant's land was a waterfront block at Longueville on which there was a house. 2 The hearing is fixed to commence next Monday, 7 December 2009, for three days. 3 I am presently dealing with a contested notice of motion by the respondent under the Uniform Civil Procedure Rules 2005 r 31.28(3) for leave to rely on three new expert reports by: (a) Russell Briggs, a valuer, dated 20 November 2009 and filed on 23 November 2009; (b) Boris Lysenko, an engineer, dated 10 September 2009 and filed on 17 November 2009; (c) Boris Lysenko dated 24 November 2009 and filed on 26 November 2009. 4 UCPR 31.28 provides: " 31.28 Disclosure of experts' reports and hospital reports (1) Each party must serve experts' reports and hospital reports on each other active party: (a) in accordance with any order of the court, or (b) if no such order is in force, in accordance with any relevant practice note, or (c) if no such order or practice note is in force, not later than 28 days before the date of the hearing at which the report is to be used. (2) An application to the court for an order under subrule (1) (other than an order solely for abridgment or extension of time) may be made without serving notice of motion. (3) Except by leave of the court, or by consent of the parties: (a) an expert's report or hospital report is not admissible unless it has been served in accordance with this rule, and (b) without limiting paragraph (a), an expert's report or hospital report, when tendered under section 63, 64 or 69 of the Evidence Act 1995, is not admissible unless it has been served in accordance with this rule, and (c) the oral expert evidence in chief of any expert is not admissible unless an expert's report or hospital report served in accordance with this rule contains the substance of the matters sought to be adduced in evidence. (4) Leave is not to be given as referred to in subrule (3) unless the court is satisfied: (a) that there are exceptional circumstances that warrant the granting of leave, or (b) that the report concerned merely updates an earlier version of a report that has been served in accordance with subrule (1)." 5 The proceedings were originally listed for hearing on 19-21 October 2009. The Court advised that, as a result of the unavailability of the judge assigned to hear the matter, the hearing had to be vacated. New hearing dates of 7-9 December 2009 were fixed. 6 The said three reports were served roughly three months after the time that they were required to be served by consent orders of the Court of 31 July 2009 and about two weeks before the December hearing. Consequently, the Court has no power to grant leave to rely on them unless it is satisfied as to one or other of the criteria referred to in r 31.28(4). The applicant submits that neither criterion is satisfied and that in any case leave should be refused because it will cause the applicant prejudice and the hearing dates would have to be vacated to enable her to respond to the new expert reports. 7 The circumstances in which these reports came to be served so late are explained in affidavits of Mr Briggs and the respondent's solicitor, Ms Walsh. Mr Brigg's valuation report of 20 November 2009 8 Mr Briggs' earlier valuation report of April 2009 valued the acquired land at $1,350,000 whereas the applicant's valuer, Mr Wotton, valued it at $2,385,000. But each valued the land on the basis of different assumptions. Mr Briggs' assumption was that the land prior to acquisition would not be developable while Mr Wotton proceeded on the assumption that the land was developable by subdivision. Each proceeded upon the basis of planning evidence put forward by their party. Neither addressed the other's valuation. Consequently, the outcome of the valuation depended upon the assumptions each had adopted. Mr Brigg's new valuation report of 20 November 2009 valued the report on two alternative bases: (a) with no subdivision potential (as contended for by the respondent); and (b) with subdivision potential (as contended for by the applicant). The significance of the new valuation report is to make Mr Wotton's valuation evidence a contested matter whereas previously it was not. 9 Mr Briggs was informed on 31 July 2009 by the respondent's solicitors of the consent orders made on that date that the parties file and serve their independent expert valuation reports on or before 21 August 2009, that the valuers confer and file and serve their joint report on or before 28 August 2009, and that non valuation experts confer and file and serve their joint reports on or before 14 August 2009. I am informed and accept that the respondent's solicitor followed up with Mr Briggs the preparation of his report in an effort to comply with the directions of the Court. During the month of October and into November 2009 Mr Briggs experienced some difficult family circumstances which meant he "dropped the ball" in relation to his work as a valuer. He explained the nature of those circumstances to the officer of the Department of Planning who retained him for work in this case. However, he did not explain those circumstances to the solicitors for the respondent. Eventually, he gave priority to the preparation of his report of 20 November 2009 that valued the acquired land on two alternate bases. Following service of his 20 November 2009 report by facsimile that day, he emailed a copy direct to the applicant's valuer, Mr Wotton, on Monday 23 November and jointly conferred with Mr Wotton in relation to Mr Wotton's report and his 20 November report on 25 November. 10 Mr Briggs thinks that the valuers are not far apart, leaving aside the critical issue of subdivision potential and cost of implementing the subdivision. He says that while regretting that his difficult family circumstances prevented him from complying with the court direction in respect of his November report, for which he apologises, he does not believe that the matters raised in the report are likely to cause any prejudice to the applicant and he remains available to complete the joint report at the direction of the court. He gives an estimate that it could be completed in less than an hour. Mr Lysenko's engineers report of 10 September 2009 11 The respondent retained Mr Lysenko to provide expert engineering advice in relation to the hypothetical potential subdivision of the acquired land. His report filed in April 2009 estimated that the construction costs of effecting the subdivision proposed by the applicant would be in the order of $891,000 but no costings were provided. On 17 November 2009 when speaking to Mr Briggs, it became evident to the respondent's solicitor that a report on the costings dated 10 September 2009 by Mr Lysenko had not been filed or served. On the same day she filed and served that report. The report provides costings accompanied by detailed sketches for an elevated roadway on the subject land on the basis of three options: $550,000 for option one, $690,000 for option two and $891,000 for option three. Mr Lysenko's engineering report of 24 November 2009 12 On 17 November 2009 when speaking to Mr Briggs, it became evident to the respondent's solicitor that a joint report of Mr Lysenko and Mr Mark Boyden, the applicant's engineer, contained a third page addendum which Mr Lysenko had not signed. She considered that the joint report was ambiguous, particularly at point 6 in relation to whether agreement had been reached on an appropriate design for an extension. Following correspondence with the respondent's solicitor on 25 November 2009 she forwarded a supplementary report by Mr Lysenko dated 24 November 2009. Discussion 13 The applicant wishes to investigate and lead expert evidence in reply to Mr Lysenko's cost estimate in his 10 September 2009 report, and in reply to Mr Briggs' November 2009 report at least insofar as it concerns subdivision potential (which Mr Briggs had not previously addressed). Expert evidence in reply to Mr Lysenko would take two to three weeks to be attended to according to the applicant's engineering expert Mr Boyden. Expert evidence in reply to Mr Briggs' November report would take twelve to fourteen days to attend to according to the applicant's valuer Mr Wotton. I am prepared to accept those estimates. 14 The applicant opposes leave being granted to rely on the new expert reports on the ground that it will require the hearing date to be vacated so as to enable the applicant to respond. The applicant points out that she has been ready for a hearing since prior to October 2009 and, through no fault of either party, the October hearing dates were vacated. Any new hearing would not take place for some months and the applicant would incur additional costs both as a result of vacating the hearing date and in having to respond to the new evidence. The applicant says that if the respondent is given leave to rely upon the new evidence and the hearing date of 7 December is maintained, she will have little alternative but to consider accepting the Valuer-General's statutory offer, notwithstanding that it is less than the value of the land acquired according to the statement of evidence of the applicant's valuer, and less than she would have been prepared to accept if the matter were to proceed next week without the respondent being given leave to rely upon the new evidence. The applicant says that she should not be put under such pressure at this late stage. 15 It is necessary for the Court to be satisfied as to one or other of the criteria in UCPR r 31.28(4) before it can grant leave to rely on these expert reports. The respondent submits that in the case of Mr Briggs' report, the criterion of "exceptional circumstances that warrant the granting of leave" is satisfied by the personal difficulties that Mr Briggs had. In my opinion they are insufficient to satisfy that criterion when considered in conjunction with the delay in service of Mr Brigg's report for about three months beyond the time required by the Court order, the proximity of service to the hearing date, and the prejudice to the applicant who is unable to respond in the available time and who would be put under undue pressure to respond at this late stage. 16 If personal circumstances prevent an expert from complying with directions of the Court, the expert should promptly inform the party retaining him so that the matter can be brought to the attention of the other party and the Court and an appropriate management response made. An appropriate management response may be for the party in question to brief another expert. 17 If the matter is considered in terms of the provisions of ss 56 to 60 of the Civil Procedure Act 2005, it seems to me that to permit Mr Briggs' valuation evidence to be relied on at this late stage is inconsistent with objects of case management set out in s 57(1). In terms of s 58, regard may be had to the fact that the respondent has been far from timely in complying with the 31 July 2009 orders, the absence of notification by the respondent to the applicant and the Court of any difficulty that had arisen, and the degree of injustice that would be suffered by the applicant if this evidence were to be permitted at this late stage. The rigour of the statutory regime under which civil litigation now has to be conducted in this State and elsewhere is well recognised: Aon Risk Services Australia Limited v Australian National University [2009] HCA 27, 83 ALJR 951; Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority [2009] NSWCA 178, 168 LGERA 1. 18 For these reasons, I decline to grant leave to the respondent to rely on the expert report of Mr Briggs dated 20 November 2009 insofar as it is concerned with subdivision potential. That part of Mr Briggs' report comprises ch 13 (at pp 31-42) and paras 14.3 and 15.3 (at pp 44 and 45). The respondent says that the balance of that report is merely an updating of Mr Briggs' earlier report. The applicant would like a further opportunity of considering whether that last proposition is correct. In those circumstances, while not granting leave to the respondent to rely on ch 13 and paras 14.3 and 15.3 of Mr Briggs' report, I stand over to the hearing before the trial judge the respondent's notice of motion to rely upon the balance of Mr Briggs' report. 19 I turn to the report of Mr Lysenko of 10 September 2009. The problem here is that the applicant's expert has advised that Mr Lysenko's proposal as outlined in that report requires a considerable amount of thought and work in preparing an appropriate response and that he is not in a position to assist within the time frame before the trial commences. That has been contributed to by the fact that his firm temporarily closed their business on 24 November for a week to allow the relocation of their office after some thirty years. The applicant's expert says that the question of costing of Mr Lysenko's proposal had not been raised with him before, that he has instructed a quantity surveyor to undertake an independent determination of the cost likely to be associated with their proposed access, and that he had not been able to speak with the quantity surveyor with regard to completing any further work concerning Mr Lysenko's access proposal. He says that because Mr Lysenko's design proposal is far from simple he would need to speak to the quantity surveyor at some length, if he is available, with regard to the approach that could be used to construct Mr Lysenko's access before an estimate could be prepared as to how much the construction is likely to cost. He says that they would need at least two weeks to undertake that work, depending on the availability of other consultants that they would require to assist. He says that complicating the matter is the fact that as a result of office re-location it would take another week before their office is back in operation. He does, however, provide the applicant's solicitors with a number of comments upon the material that had been sent. 20 Having regard to the prejudice to the applicant of not being able to respond until after the hearing next week, on balance I do not think that I should grant leave for this report to be relied upon. 21 It was not suggested that the hearing dates should be vacated to accommodate either this report of Mr Lysenko or the report of Mr Briggs (with the respondent to pay the costs thrown away) but that would not seem an appropriate solution in the circumstances. 22 The report of Mr Lysenko of 24 November 2009 is in a different category. It is supplementary to the joint experts' report. It emerged in discussion before me that the applicant does not have a difficulty with the comments in this new report on item 6 in the joint report. That accords with my own view. I regard the matters in this report as updating an earlier version of a report by Mr Lysenko that has been served. To the extent that it is also commenting upon an addendum to the joint report by the applicant's own expert which did not form part of the joint report itself, I consider that that constitutes exceptional circumstances that warrant the granting of leave. For these reasons I grant leave to the respondent to rely on the report of Mr Lysenko of 24 November 2009. 23 I order the respondent to pay the applicant's costs of the notice of motion to date and of the directions hearing on 27 November 2009. Whether the hearing dates should be vacated 24 Upon delivery of the above extempore reasons for judgment, the respondent orally applied for an order vacating the hearing dates next week and, if that application is granted, for leave to rely at the adjourned hearing (which would be some months away) on the reports in respect of which I have earlier declined to grant leave to rely at next week's hearing. 25 The grounds upon which this application is made are, first, that Mr Briggs' evidence is fundamental to the respondent's reply case and makes a significant financial difference which it is said may be of the order of $1 million; secondly, the cause of the fault is not that of the respondent per se but of the independent valuer; and, thirdly, the valuers have not prepared a joint report. 26 The second of the grounds on which the applicant relies requires qualification. Mr Briggs says that he did explain the nature of his family circumstances (which caused him to "drop the ball" in relation to his work as a valuer) to an officer at the Department of Planning who retained him for the job. It therefore appears that the respondent was not unaware of his difficulty. 27 The grounds on which the applicant otherwise relies have to be balanced against other considerations. 28 Hearing dates are not fixed provisionally upon being vacated to accommodate the late service of evidence. Parties have a reasonable expectation that when hearing dates are fixed they will be maintained unless there are sound reasons for not maintaining them. There should be taken into consideration that the respondent was about three months late in complying with the Court's orders as to service of expert reports, did not notify the applicant or the Court of any difficulty so that it could be managed, and did not serve the reports until it was too late for the applicant to respond before the present hearing. In all the circumstances, I do not think that vacating the hearing dates and ordering the respondent to pay the cost thrown away are an appropriate exercise of the discretion having regard to the regime in ss 56 to 60 of the Civil Procedure Act 2005. I therefore decline to accede to the application to vacate the hearing dates. 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.