ASIC v Rich [2006] NSWSC 712

New South Wales Supreme Court

CITATION : ASIC v Rich [2006] NSWSC 712

HEARING DATE(S) : 28 & 29 June, 3-7 July 2006

JUDGMENT DATE : 14 July 2006

JURISDICTION : Equity

JUDGMENT OF : Austin J

DECISION : Objections overruled

CATCHWORDS : PRACTICE & PROCEDURE - pleading - whether cross-examination testing defendant's evidence amounted to a new, unpleaded case - probative value of challenged evidence - whether danger of unfair prejudice to defendants

LEGISLATION CITED : Evidence Act 1995 (NSW) s 135

CASES CITED : Banque Commerciale SA, en Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279 Rich v ASIC (2004) 220 CLR 129

Australian Securities and Investments Commission (P) PARTIES : John David Rich (D1) Mark Alan Silbermann (D4)

FILE NUMBER(S) : SC 5934/01

COUNSEL : R B S Macfarlan QC with J P A Durack SC (P) D L Williams SC with M J Steele (D1, D4)

SOLICITORS : Georgina Hayden, Solicitor for Australian Securities and Investments Commission (P) Thompson Eslick (D1, D4)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

AUSTIN J

FRIDAY 14 JULY 2006

5934/01 AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION V JOHN DAVID RICH & ORS JUDGMENT 1 HIS HONOUR: These reasons for judgment relate to an objection by Mr Williams SC, for the defendants, at T 11,423, to a question addressed by Mr Macfarlan QC for ASIC to the first defendant, Mr Rich, in cross-examination. Mr Williams SC also objected to the line of questioning of which the particular question formed part. I allowed the question, and the line of questioning of which it formed part. In response to my invitation, Mr Williams asked me to provide written reasons. 2 Subsequently there have been objections raising the same or similar issues on frequent occasions, which I shall identify by transcript references. Although I have made rulings without being asked to provide reasons (other than that the rulings were governed by the same general principles that I applied to the first matter), it seems to me appropriate to deal briefly with those other occasions so as to explain the principles which I have applied. 3 Each objection asserted that the line of questioning was outside ASIC's pleadings and amount to an attempt to establish a previously unpleaded case; and that the court should exclude the evidence given in response to the questions on the ground of unfair prejudice under s 135 of the Evidence Act 1995 (NSW). 4 To deal with the objections, I shall first consider ASIC's pleadings (and relevant parts of Mr Rich's Defence) in light of general principles, and make some observations about the kinds of matters that would and would not fall within the scope of ASIC's pleaded case. I shall then deal with each objection separately, identifying the line of questioning in a manner intended to reveal whether the evidence to be adduced by the questions is relevant to ASIC's pleaded case, and if so, its weight or probative value. I shall note the particular submissions made when the objection was taken, and briefly state the reasons for my rulings in light of the general principles I have identified. Pleadings