Supreme Court New South Wales Medium Neutral Citation: Landtwo v Coffey Geosciences [2014] NSWSC 625 Hearing dates: 16/05/2014 Decision date: 16 May 2014 Jurisdiction: Equity Division - Technology and Construction List Before: McDougall J Decision: Dismiss application for reference out of some technical issues. Direct experts to confer and produce joint report. Catchwords: PROCEDURE - judgments and orders -whether matter appropriate for reference out of technical issues - whether there should be joint expert report and conclave before any order made for reference out - no question of principle Category: Procedural and other rulings Parties: Landtwo Pty Ltd (Plaintiff) Coffey Geosciences Pty Ltd (First Defendant) Robson Civil Projects Pty Limited (Second Defendant) Representation: Counsel: C Nowlan (Plaintiff) IG Roberts (First Defendant) Solicitors: Minter Ellison (Plaintiff) Kennedys (First Defendant) File Number(s): 2011/229373 Judgment (ex tempore - revised 16 may 2014) 1HIS HONOUR: The plaintiff is a proprietor of a development at Somersby on the Central Coast of New South Wales. It seems that the site comprises three platforms. The topmost platform was cut into rock. The middle and lowest platforms were either constructed entirely in fill or partly founded on cut material and partly constructed in fill. They are retained by retaining walls. There is a question as to the adequacy of the retaining walls, which were designed by the first defendant, to perform their intended function. 2The plaintiff seeks an order for the reference out of certain technical questions. The starting point is that I do not think that this is an appropriate case where specific technical issues should be referred out. Fundamentally, the issues are these. What were the first defendant's design obligations? Did the design produced by the first defendant satisfy its contractual obligations? If it did not, what is necessary by way of rectification? If rectification is necessary, what is the proper cost of rectification? 3The issue, of fitness for purpose, is one of those that is proposed for reference out. Likewise, the issue of rectification is proposed for reference out. For reasons that at present I do not understand, the issue of the cost of rectification is not proposed for reference out. 4The remaining questions that are posed go essentially to the question of fitness for purpose and, with some exceptions, to what was done by the first defendant to satisfy its contractual obligations. That sort of hybrid reference, which sends out some but not all questions of liability and some but not all questions of damage, does not seem to me to be satisfactory. 5The first defendant (who is the only defendant left standing, because the second defendant - the contractor - has settled its differences with the plaintiff) says in any event that before a decision is made, there should be a joint conference of the geotechnical experts, and they should be encouraged to produce a joint report, in the usual way, outlining areas of agreement and disagreement, and the reasons for disagreements. 6By way of background, it needs to be understood that there was a Court-ordered mediation. Before that mediation, the experts then involved conferred. They produced a joint report. That joint report is not available for use in the proceedings, because it is confidential. There were attempts by the parties to circumvent that confidentiality by giving opinion evidence as to what one might understand, having regard to the contents of the confidential reports, to be the state of agreement or disagreement fell by the wayside. 7It may be, as Mr Nowlan for the plaintiff submits, that a further conference will not achieve any measure of agreement. As against that, it should be noted that since the previous conference took place, the plaintiff has retained another expert; and an expert retained for the second defendant has ceased to be involved as a potential witness. Whether those changes will make any difference is something on which I cannot express an opinion. 8Even if a further conference does not produce any measure of agreement, it will nonetheless, I think, enable the Court to understand more clearly what are the differences between the experts and why, in summary form, those differences exist. 9Thus, I think, before a decision is made whether the matter should be referred out (in part, as the plaintiff submits, or in whole, as the first defendant submits should happen if there is to be a reference), a conference and joint report would have utility. 10I accept that a further expert conference, and a further joint report, will be expensive. However, if the matter were to be heard by the Court, that step would be taken, pursuant to the usual order for hearing, unless the Court dispensed with it. Speaking for myself, and accepting that it is unlikely that I will be the list judge when the matter is fixed for hearing (if that is what is to happen), I would not be inclined to dispense with a conference and joint report. 11That then raises the question of why the same steps should not be taken if the matter is to be referred out. Mr Nowlan was unable to offer any answer to this question. 12It does seem to me that the way forward is to have a conference of the experts and the production of a joint report. One outcome would be that the experts may be able to agree, if the views of another or others are accepted as to defects and as to consequential problems in the retaining wall systems, what would in that hypothetical circumstance be the appropriate method of repair. That would then provide an assumed basis on which the quantity surveying experts who have also been retained could cost alternative repair proposals. 13At present, until a decision is reached as to the likely method of repair (if any repair be needed), all the quantity surveying experts can do is give evidence at large of rates and possible quantities involved on various entirely hypothetical scenarios. 14As the notice of motion is framed, it does not seek a reference out of the whole proceedings. I do not think at this stage that it is appropriate to refer out only limited questions. Indeed, my inclination is to think that either the whole of the proceedings should be referred out or alternatively the whole of the proceedings should be heard and determined by the Court. 15Nonetheless, I accept the submission of Mr Roberts, for the first defendant, that a decision as to the appropriate method of resolution of the dispute is likely to be better informed if it is based on a joint report prepared by the geotechnical experts following a further conclave process between them. 16In those circumstances, I think that it is appropriate to dismiss the notice of motion seeking reference out, but to do so on the basis that the question of a reference out can be raised by way of further application following a conference and joint report. 17Having done that, the next step is to direct the geotechnical experts retained by the parties to confer and produce a joint report, for use in the proceedings, setting out, among other things, the areas of agreement between them, the areas of disagreement, and the reasons for such areas of disagreement as remain after that process has been completed. 18At that the stage, the question of reference out (or allocation of a hearing date) can be considered. 19I accept that this involves imposing a level of costs on the parties before the question of the appropriate mode of hearing is decided. But as I have said, it is a cost that is likely to be incurred regardless of the way in which the matter is heard. And it is a step which, in my view, will guide the parties and the Court in forming a view as to the appropriate way in which the issues should be resolved. 20For those reasons I make the orders that I have indicated. It will be appropriate to stand the matter over for directions at a time sufficient to enable the parties to consult their experts and work out a timetable for the conclave and report. [Counsel addressed] 21I make orders in accordance with paragraphs 1 to 3 as amended of the short minutes of order initialled by me and dated today's date. 22I order that the costs of the plaintiff's notice of motion be the defendant's costs in the cause. ********** 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: 21 May 2014