Supreme Court New South Wales Medium Neutral Citation: Dymocks v Capral [2013] NSWSC 130 Hearing dates: 20/02/2013 Decision date: 20 February 2013 Jurisdiction: Equity Division - Technology and Construction List Before: McDougall J Decision: Tender rejected Catchwords: EVIDENCE - admissibility - where letter written by party's solicitor to insurer - party not the author of the letter and made no representations by or in it - letter not admissible to prove the truth of the the previous representations made by its author - letter not admissible to prove suggested admission by party. Legislation Cited: Evidence Act 1995 (NSW) Category: Procedural and other rulings Parties: Dymocks Book Arcade Pty Ltd (ABN 13 000 009 441) (Plaintiff) Capral Limited (ABN 78 004 213 692) (First Defendant) Peter Dalton Architects Pty Ltd (Second Defendant) Stramit Corporation Limited (Formerly KH Stramit Corporation Limited) (First Cross-Defendant to Second Cross-Claim) Representation: Counsel: D T Miller SC / D A Hughes (Plaintiff) HJA Neal (First Defendant) IDM Roberts SC / LWF Chan (Second Defendant) I R Pike SC / J J Hutton (First Cross- Defendant to Second Cross-Claim) Solicitors: Norton Rose (Plaintiff) Colin Biggers & Paisley (First Defendant) Kennedys (Second Defendant) Sparke Helmore (First Defendant Second Cross-Claim) File Number(s): 2009/298893 Judgment - on admissibility of evidence; see page 186 of the transcript 1HIS HONOUR: Mr Miller of senior counsel, who appears with Mr Hughes of counsel for the plaintiff, is cross-examining Mr Peter Dalton, who is the principal of the second defendant. The plaintiff's claim relates to what it says is (and what appears to be) a defective roof on a residence at Grassy Head, on the mid-north coast of New South Wales. Mr Dalton's company (and for present purposes it is unnecessary to distinguish between him and the company) was the architect who designed the house, and who specified the roofing materials and their fixing method. 2A factual issue raised by Mr Dalton is that, in the course of preparation and finalisation of the design and specification, he consulted with a corrosion expert, Dr Greig Wallwork. It may be convenient at this point to mention that the parties are agreed that, by reason of his state of health, Dr Wallwork is unable to give evidence. 3In substance, Mr Dalton's evidence is that he discussed the roofing material (coated aluminium sheeting) and the fixing method (stainless steel screws, over a zinc shoulder and using washers, into mild steel purlins). 4The plaintiff's case is that this combination of metals has caused, in the presence of salt laden air (which everyone agrees would be an obvious feature of the locality), a galvanic reaction to set up as a result of which the aluminium roof sheeting has corroded. 5Mr Dalton says, by way of defence, that (among other things) he relied on the opinion or advice of Dr Wallwork, and that in all the circumstances it was reasonable for him to do so. 6The only evidence of Dr Wallwork's advice is contained in paragraphs of Mr Dalton's first statement, including paragraphs 27 and 33, where in effect Mr Dalton says he discussed the roofing method with Dr Wallwork and an engineer, Mr Jack Davies. According to Mr Dalton, in the course of those conversations, Dr Wallwork said in effect that what was proposed was "consistent with" the then applicable Australian Standard (AS 1562-1980). 7Mr Miller has been cross-examining Mr Dalton on the time that it took for the preparation of that statement by Mr Dalton. The founding proposition was that the plaintiff's evidence was received in December 2010, and that Mr Dalton's statement in chief was not signed until 23 December 2011. The proposition, put in various ways and sometimes accepted and sometimes not, is that Mr Dalton was preparing his statement, or working on it, over that 12 month period. 8Mr Miller wishes to cross-examine Mr Dalton on a letter written by his solicitors to the insurer. I should note that it seemed to be common ground that privilege had been lost in the letter (to the extent that it was in evidence). It is unnecessary to go to the details of that loss. 9On its face, that letter (which has been heavily redacted) appeared to comprise some 11 pages. On page 7, under the heading "Cross Claims", there is a reference to Mr (i.e. Dr) Wallwork. Under that heading, it is said that the specification, or the allegedly erroneous specification, "was caused or contributed to by Mr Wallwork's advice". 10On the following page, page 8 of 11, there appears the following (leaving out the gaps for internal redactions): "The only evidence of the representation being made, indeed of Mr Wallwork's involvement in the design process, is what is set out in Peter Dalton's statement. For the better part of this year while working on Mr Dalton's statement with him, he has been unable to bridge the gap between the fact of the advice he says he was given by Mr Wallwork (a fact he is and has always been adamant about) and evidence of that fact. In the final throes of preparing his statement Mr Dalton recalled meetings and conversations with Mr Wallwork during which the advice was given. There are no documents corroborating his recollection of the advice he received. The only evidence of it is the specification itself." 11Mr Miller wishes to put that to Mr Dalton, and to seek to obtain Mr Dalton's agreement to the following propositions: (1) that Mr Dalton had been working (with the lawyers) on his statement for the better part of a year; (2) for most of that time he had been unable to recall the conversations in which he says the advice was given; and (3) it was only at the end of that process that Mr Dalton was able to recall the relevant meetings and conversations. 12Mr Miller submitted, among other things, that the letter constituted an admission, for the purposes of s 81 of the Evidence Act 1995 (NSW), and thus that the letter could be adduced into evidence. 13It is unnecessary to consider the credibility rule (see s 102 of the Evidence Act, read in conjunction with the definition in s 101A of "credibility evidence"). That is because, in my view, the letter would not be admissible to prove the asserted facts on which Mr Miller wishes to rely; and even if, technically, it were admissible, I would in any event exclude it in pursuance of s 135 of the Evidence Act. 14I start with the question of admissibility. Section 81 permits evidence to be given of an admission. The Dictionary to the Evidence Act defines an admission as a previous representation made by a party to a proceedings that is adverse to that party's interest in the outcome (I have paraphrased the definition insofar as it is relevant to the present state of affairs). 15Mr Dalton is not the author of the letter and makes no previous representation by or in it. The only previous representations that are made in the letter are those made by its author to the insurer. The letter could only prove an admission made by Mr Dalton (assuming, for the moment, that the underlying facts could be capable of being so characterised) if it were admissible to prove the truth of the represented facts. 16However, it seems to me, any attempt to tender the letter for the purpose of proving the truth of the representations made by the author to the insurer must fail. The letter is not a business record, because, clearly, it was prepared for the purpose of conducting these very proceedings (see s 69(3) of the Evidence Act). Thus, if the letter were tendered, it could do no more than prove the fact of communication of the representations set out, and perhaps the communication of what are said to be the asserted facts contained therein. It could not prove, for example, that Mr Dalton, as a matter of fact, had only recalled the relevant meetings and conversations at the end of the process of preparing his statement. 17If the letter is not admissible to prove the truth of the asserted facts, or the previous representations made by its author to the insurer, then it seems to me to go nowhere. Specifically, it does not seem to me to be capable of proving a previous representation made by Mr Dalton (and it is he, or more accurately, his company, the second defendant, that must make the representation if it is to be relied upon as an admission). 18In any event, as I have said, if, contrary to the view that I have just expressed, the letter were strictly speaking admissible, I would reject it in reliance on s 135. For better or for worse, the letter is summary and conclusive in form on this aspect of what it says. It does not enable any judgment to be made of the underlying facts. Specifically, it does not enable any judgment to be made as to what it was Mr Dalton said, and did not or could not say, at any particular time. The reference to "the final throes of preparing his statement" may well be capable of suggesting that the recollection came late in the process. But that is hardly surprising, for at least two reasons. 19The first reason is of course that it is common human experience that recollection may improve as the person being asked to recollect works on, or works over, or thinks about, the events in question. Thus, whilst a "recollection" appearing at the very end of the process may appear to be somewhat suspicious, whether or not that is so depends critically on what happened over the time in question - the year or so over which, apparently, work was being done on Mr Dalton's statement. There is no evidence of that. 20The second reason is that, as I was informed without objection in the course of submissions, one of the reasons why Mr Dalton's statement was held up was that it was thought desirable for him to have access to expert evidence served on behalf of the plaintiff. That expert evidence came from an architect, Mr Sarlos. Mr Sarlos commented on many matters relevant to what should or should not have been done some 24 or 25 years ago, when the design and specification were being prepared. It is at least conceivable (and I would have thought quite probable) that the very fact of reading and considering what Mr Sarlos said (which, I was told, did not become available until about October 2011) may have caused some revival of memory. 21Thus, it seems to me, any attempt to tender the letter and rely upon it for the purpose of impeaching the credibility of Mr Dalton's "recollection" of the relevant events would be prejudicial (because it would not be put in the entire context of the process of preparation of his statement), might well be misleading or confusing for the same reason, and would in any event cause (as in my view it has already caused) undue waste of time. 22In short, it seems to me, even if the letter were strictly speaking admissible to prove the truth of the matters asserted in the previous representations on which reliance is placed, such probative value as that has is minimal, and the overall prejudicial effect, bearing in mind the lack of context, justifies invocation of the general discretion comprised in s 135. 23I add that, these views having been suggested to Mr Miller, in the course of submissions, he indicated an intention to rely on s 44(3) of the Evidence Act. I started to hear some argument on that, but came to the view that it would be better to hear that argument, not on the basis of assumptions as to what the questions and answers might be, but after they had been put and at a point when the objection was properly to be taken. Thus, nothing in what I have said should be taken as indicating any view on the propriety, in a legal sense, of the proposed s 44 exercise. ********** 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. Decision last updated: 27 February 2013