FEDERAL COURT OF AUSTRALIA

McHugh v Australian Jockey Club Limited (No 9) [2011] FCA 1138

REASONS FOR RULINGS

1    The applicant applies to exclude, by deletion, certain written evidence by Dr Keller and Dr McKinnon, expert veterinarians called by the applicant, on the ground that since that evidence was given the fifth respondent has notified its decision not to call one of its expert veterinarians, Dr Perriam. I have been told that it was on 27 September 2011 that the applicant was informed Dr Perriam would not be called in the fifth respondent’s case. The fifth respondent’s witnesses, or those that are to be called, are due to be heard in about one week’s time.

2    It is to be noted that the application is not to exclude Dr Perriam’s evidence as such but evidence by Dr Keller and Dr McKinnon which is expressly or by implication said to be affected by what Dr Perriam has written, or may be taken to have said in a conference between experts to which I will refer more fully below. Each of these people, that is, Dr Keller, Dr McKinnon and Dr Perriam, is a veterinarian whose written evidence had been filed by the applicant or the fifth respondent and on that basis I directed, some weeks ago, that those experts confer and produce a report outlining their areas of agreement and disagreement. They did so confer on two occasions in late August 2011.

3    Dr Perriam had made a report which had been filed in Court commenting on earlier reports of Dr Keller and Dr McKinnon and each of those two veterinarians had responded in writing to Dr Perriam’s comments and those are contained in Dr Keller’s second report, exhibit HH and Dr McKinnon’s second report, exhibit D. There are also joint reports which largely constituted comments on those reply reports each of Dr Keller and Dr McKinnon. The notification that Dr Perriam would not be called came therefore after the meeting of the experts which resulted in the joint reports.

4    Further relevant facts are that a document outlining areas of agreement between expert veterinarian witnesses was first marked MFI 2, then when Dr McKinnon was called part of MFI 2 was tendered through him but limited as expressing only his opinion. He had not participated in the balance of the conference between experts. Later the entirety of MFI 2 was admitted and marked exhibit JJ, as stating Dr Keller’s views because he had participated in the entirety of the conference between experts.

5    At tr 242 Senior Counsel for the first, second and sixth respondents said in relation to Dr McKinnon:

What my friend can tender is the joint report insofar as it reflects his – that particular witness who has been called – opinion. It doesn’t become evidence of the opinion of anybody else unless and until they are called. They may never be called, so – otherwise, you have the problem of – or, we might get the benefit of – or, those on our side get the benefit of the opinion of persons without them ever[y] having to be called, so – but to the extent that the joint report encapsulates something which, notwithstanding, they agree to. They – neither of them can speak to – but not in that form, then it is still inadmissible, which, I think, is preserved by your Honour’s remarks.

6    At tr 310 counsel for the fifth respondent asked and Dr McKinnon answered:

Dr McKinnon, do you have a copy of the joint report in respect of your second

report?---I do.

Do you hold the opinions expressed in that joint report?---I hold the opinions

expressed between the veterinary witnesses where I was present in that particular –when I present in that meeting. I have not – unfortunately, it was – when we had our joint meeting, unfortunately our practice manager cut off my internet access for 48 hours by mistake, so I was not able to be present for the second meeting, which discussed Stuart Keller’s report. However, I was present and initiated the first meeting, which begins “written by Stewart Keller”.

Yes. So just – but limiting yourself to that report, that is, the second report dealing with – the report dealing with your second report, do you hold the opinions expressed- - -?---Yes, thank you.

- - - in that joint report?---Yes, I do.

I tender that joint report.

7    At tr 323-324 the following was said:

MR TONKING: Your Honour, I think then there’s a matter of tendering some

material – some evidence. Firstly, there was the question of the two joint reports, which your Honour marked, from the veterinary witnesses. We would propose to tender that. It’s MFI 2.

MR BANNON: I think our position on that, your Honour, is that one of those

reports Mr McKinnon has signed up to - - -

HIS HONOUR: Yes.

MR BANNON: - - - or part of that. And, I think, in answer to a question from Mr

Emmett, he agreed that they reflected his views.

HIS HONOUR: Yes.

MR BANNON: And there’s no difficulty with the document going in – that part of the document going in insofar as it reflects his views, but beyond that, I’m not sure it has a wider status.

HIS HONOUR: So is there [a] question which will be explored, or may be explored, in due course about whether it also expresses the views of the other people who have signed it, Keller, Perriam and Perkins? Is that the point?

MR BANNON: Well, the only difficulty – if, for example, Dr Keller is never called as a witness, then his views can’t be included indirectly, as it were

HIS HONOUR: All right. So you you’re - - -

MR BANNON: Maybe it is just being overly cautious, but - - -

HIS HONOUR: So I didn’t quite follow what you’re saying. That’s about pages 10 through to 14.

MR BANNON: Yes.

HIS HONOUR: So that can go in as exhibit B.

8    On 23 September 2011 at tr 1283-1284 Dr Keller was called by the applicant. In chief the following occurred:

Thank you. And you have made another statement dated 10 August 2011?---Yes.

And I think there is one correction in paragraph 42 on page 16 of that statement, or perhaps - - -?---Yes, paragraph 42, the last sentence should read:

For the reasons set out above, it may but will not necessarily be the case that mares will travel –to –a specialised breeding centre for insemination to take place.

Yes. Thank you, Dr Keller. And subject to those corrections, are the contents of those statements of yours true and correct to the best of your knowledge and belief?---They are.

And do you have with you a copy of the document prepared by Dr Perkins as a result of the teleconferences you had with him and, I think, Dr Perriam?---Yes, I do.

Do you wish to make a comment in relation to your understanding on point 31 of that document, which commences on page 4 and goes over to page 5?---This is the document outlining agreements between expert witnesses?

Yes. Yes?---Yes, I wanted to be sure that there was not a misunderstanding in the purport of the statement – the additional part of that statement which commences at point 31 on that page, point 26. The statement reads that:

It is also important to note that collecting semen more than once every second day in an AI program may reduce the daily sperm output of a stallion over time and consequently reduce the number of mares that might be able to be bred to a single ejaculate. By way of explanation that follows, the explanation could have been interpreted to imply that the – in an AI program – and this is stated on the following page in the last sentence of that explanation – that:

In AI programs where each ejaculate may be divided into 5 multiple breeding doses and where each breeding dose is intended to contain a minimum number of sperm, frequent collection may progressively reduce the number of mares that could be bred to a single ejaculate.

It could be interpreted that the frequent collection of a stallion in an AI program would result in a progressive reduction. In fact, the intent of that statement is to highlight that the frequent collection where it exceeds the alternate day collection program will reduce the stallion to a daily sperm output, which is a static level rather than a progressive and ongoing deterioration in the number of mares that could be

bred.

Yes. Thank you, Dr Keller.

MR BANNON: Well, I think that is only admitted as to his intent, not - - -

MR TONKING: Yes.

HIS HONOUR: Yes. I assume so.

and at tr 1287 in cross-examination of Dr Keller:

So could I direct your attention to page 7 of MFI 2 which is the joint report. And could I ask you to look at paragraph 52 which should have “point 47” next to it?---Yes.

Just read those two paragraphs to yourself.

HIS HONOUR: Mr Bannon, the other part is exhibit B.

MR BANNON: Thank you, your Honour. My friend I think proposes to tender

now that the other MFI 2, and there’s no objection to it from [our] point of view at least. So - - -

MR EMMETT: Nor mine.

HIS HONOUR: Do you want to tender it, Mr Tonking?

MR TONKING: Yes, it may be convenient to do that, your Honour.

HIS HONOUR: Yes. So that will be exhibit JJ.

MR BANNON: So Dr Keller, if you would look at paragraph 52 of that document which is now exhibit JJ, and have you read those two paragraphs to yourself?---Yes, I have.

And obviously there’s matters in which you agreed; correct?---Yes.

9    Against that background it was submitted on behalf of the applicant that there had been unfairness and that the parts of the evidence identified in a summary which I marked as MFI 39 should be deleted or excluded. Reference is made to the judgment of RD Nicholson J in Australian Competition and Consumer Commission v Lux Pty Limited [2003] FCA 949 (“Lux”). The applicant further submitted that there had been a subversion of the process of the joint report in that Dr Perriam had participated in that process.

10    It was said that Dr Keller and Dr McKinnon would not have made qualifications to their earlier reports by way of the joint report and now what Dr Perriam had said could not be tested. It was submitted that exhibit JJ identified items where the reports of Dr Keller or Dr McKinnon had been qualified, stemming from what Dr Perriam had said or must be taken to have said.

11    There is no evidence, either from Dr Keller or Dr McKinnon that their evidence would have been different if they had thought that Dr Perriam was not to be called. The matter was argued therefore by the applicant as a point of principle. It was the process that was said to have been prejudiced or subverted. It was submitted that the matter was not to be tested by looking at the result but the effect or damage was caused when the experts went into the joint conference. To the proposition that if the general argument were correct then the whole of the joint report should go out, the applicant responded that his approach was only selective insofar as he did not seek to exclude the material where the respondents’ expert agreed with the applicant.

12    It seems to me that a significant matter affecting the present application is that the evidence sought to be excised is the evidence of experts. I therefore referred in argument to the general terms of the practice note in relation to expert witnesses reissued by the Chief Justice on 1 August 2011 as CM7 (footnote omitted):

1.    General Duty to the Court

1.1    An expert witness has an overriding duty to assist the Court on matters relevant to the expert’s area of expertise.

1.2    An expert witness is not an advocate for a party even when giving testimony that is necessarily evaluative rather than inferential.

1.3    An expert witness’s paramount duty is to the Court and not to the person retaining the expert.

3.    Experts’ Conference

3.1    If experts retained by the parties meet at the direction of the Court, it would be improper for an expert to be given, or to accept, instructions not to reach agreement.  If, at a meeting directed by the Court, the experts cannot reach agreement about matters of expert opinion, they should specify their reasons for being unable to do so.

13    I accept that the result of a conference between experts may be compromise. The process intends that the experts consider the differences between their stated views and identify where, in substance, they agree with each other and where they do not. However, I do not see this, of itself, as a source of prejudice. It may be that one or more of the experts believe that all the other experts have not only provided reports, but that they will also be called to give evidence. I do not see that there was a sound basis for that belief in this case, but even if there was a mistaken belief of that kind, I am not persuaded that the process would be subverted.

14    I leave aside for another day what may be the position if a party had already decided not to call an expert as a witness when the conference between experts took place or when the points of agreement and disagreement were later reduced to writing.

15    I also considered it necessary on this application to look separately at each part of the evidence sought to be excluded. It was my provisional view that there were two categories. The first category was the reply reports of Dr McKinnon and Dr Keller, that is, those parts of their reports where they were answering Dr Perriam’s written report. The second category was parts of exhibit JJ, the joint report.

16    It is of course generally true that where a witness answers what he or she thinks will be another person's evidence and that other person is not called, the answer is strengthened in the sense that the putative evidence of the person who was to be called but is no longer to be called will be rejected or will receive little, if any, weight. The point has not been reached, if it is ever reached, that Dr Perriam’s report will be sought to be tendered.

17    I turn, then, to consider the first category that I have identified, that is, the reply reports.

18    As to Dr Keller’s second report, exhibit HH, I have looked at each of the parts identified in MFI 39.

    I can see no prejudice to the applicant in the last three sentences of [16]. I note that those sentences are subject to Exhibit JJ;

    I can see no prejudice to the applicant in the first sentence and second sentence up to the word "however" in [21];

    as to [24], the first sentence and second sentence up to the word "but", I can see no prejudice to the applicant in this material. I note that those sentences are subject to exhibit JJ;

    as to the whole of [26], [27] and [31], again I see no prejudice to the applicant in this material. I note that those paragraphs are subject to exhibit JJ.

19    I also find that there is not a danger that a particular use of this evidence might be unfairly prejudicial to the applicant, or be misleading or confusing within s 135 or s 136 of the Evidence Act. I do not exclude it under either of those provisions, or otherwise.

20    As to Dr McKinnon’s second report, exhibit D:

    I can see no prejudice to the applicant in [34]. I note that this is material that Dr Keller has himself already responded to in material in respect of which the applicant seeks no relief;

    in respect of [39.1] first sentence, and [39.3] last sentence, I see no prejudice to the applicant;

    as to the whole of [40], I can see no prejudice to the applicant;

    as to [41.3], I can see no prejudice to the applicant;

    as to the whole of [45] to [46], I can see no prejudice to the applicant.

21    I also find there is not a danger that a particular use of this evidence might be unfairly prejudicial to the applicant, or be misleading or confusing within s 135 or s 136 of the Evidence Act. I do not exclude it, either, under those provisions, or otherwise.

22    I turn to the second category.

23    First I consider that part of exhibit JJ, being the “Document outlining agreement between expert witnesses”, which addresses Dr Keller’s second report.

24    It is to be recalled that in his evidence in chief Dr Keller added a further qualification to this material (see above). Further, as I have set out above, Dr Keller acknowledged that he had agreed those matters in exhibit JJ. Thus, in my view, there is no basis for thinking that the statements in exhibit JJ were matters with which Dr Keller disagreed or agreed only in a conditional or qualified way. I also note that when exhibit JJ was tendered, it was not tendered on any provisional basis but was tendered on a limited basis, that is, as to what Dr Keller agreed.

25    As to the specific part sought to be rejected or deleted, I do not see on what basis it is said that some parts should remain but others should be excluded. It seems to me that either all of the results of the allegedly flawed process must be excluded, or none of them.

26    Be that as it may, more specifically, I have reviewed the parts listed in MFI 39, both of themselves and against the corresponding paragraphs of Dr Keller’s second report. Having done so, I see nothing which would suggest that there is a danger that that material might be unfairly prejudicial to the applicant, or misleading or confusing. None of it is expressed to be conditional, either at all or in the sense that Dr Keller agreed with the proposition only if some other matter were accepted or established, in particular, anything coming from Dr Perriam. All of it seems to me to be the proper result of considered review. In saying that, I realise that the applicant submits that the matter should not be approached or assessed by result.

27    As to exhibit JJ being the “Document outlining agreement between expert witnesses”, addressing Dr McKinnon’s second report, again I have reviewed the specific parts listed in MFI 39, both of themselves and against the corresponding paragraphs of Dr McKinnon’s second report. Having done so, I am of the same views as I have set out above in relation to the Dr Keller material.

28    Thus, I do not exclude exhibit JJ under either of s 135 or s 136 of the Evidence Act or otherwise.

29    Lastly, I turn to consider whether authority requires or suggests any different approach or conclusion. And I refer here, again, to RD Nicholson J’s judgment in the Lux proceedings.

30    It is not entirely clear what the facts were in those proceedings. It seems that Ms Murphy was an expert psychologist to be called by the applicant, the ACCC, and Mr Wolowski was an expert psychologist to be called by the respondents. Those two experts exchanged their respective reports. Thereafter, they participated in a joint conference of experts and produced a joint expert report.

31    Some months later, the applicant opened its case. It appears that the joint expert report was tendered as setting out the evidence of both Ms Murphy and Mr Wolowski. The trial continued up to at least 9 April 2003, when the respondents advised the Court that, due to illness, they would not call their expert witness, Mr Wolowski, to give evidence at the trial. The applicant, the ACCC, claimed that until 9 April 2003, the date of that notification, it had conducted its case on the basis that the respondents would call Mr Wolowski to give evidence in support of the matters raised in his report and the joint expert report.

32    The applicant submitted that the position affected the manner in which the applicant chose to lead evidence from its own witnesses and cross examine the witnesses called by the respondents. Further, the applicant submitted the position affected the objections the applicant decided to make and decided not to make. Thereafter the applicant indicated that it wished to be heard on the excision of evidence. After hearing from the parties, on 10 April 2003 the Court ordered as a first step that the use of the evidence in the joint report be limited to the expression of opinion therein by Ms Murphy, and that no reliance be placed on the exhibit in respect of any opinion of Mr Wolowski.

33    Thereafter and accordingly, the parties agreed on a procedure to allow the Court to determine whether evidence already before the Court should be excluded or limited in any way, by reason of s 136 or some general discretion vested in the Court. The unfair prejudice contended for on behalf of the applicant was that, had it known that the respondents would be unable to rely on Mr Wolowski’s evidence, the applicant would have objected to the tender of Mr Wolowski’s report, the joint report and Mr Wolowski’s views expressed at the joint conference, and references to them. The unfair prejudice was said to be the loss of opportunity to object to the admission, and the denial of opportunity to cross examine Mr Wolowski.

34    It seems, although it is not entirely clear, that it was RD Nicholson J who said that it was the denial of opportunity to cross examine which must weigh in the assessment of unfair prejudice in light of the earlier ruling of 10 April 2003, limiting the use of the joint report to the expression of opinion of Ms Murphy.

35    RD Nicholson J then considered each particular piece of evidence the subject of the application and in relation to the criteria in s 136. It seems that, in the result, five of the 22 categories identified by the applicant were the subject of some limitation. In some instances the ruling was that there was no basis for the limitation, as the material was either the expression only of the view of Ms Murphy in the joint report, or that it had already been directed that usage was limited to the expression of Ms Murphy’s opinion in the joint report.

36    Thus, it does not appear that any application to exclude any material which expressed Ms Murphy’s views, whether expressed as only her views or as a joint view with Mr Wolowski, was successful. What appears to have been excluded was limited to that material which was an expression only of the views of Mr Wolowski, except, possibly, in one instance, where the words “I assume that Mr Wolowski would be doing the same” were excluded.

37    It seems, therefore, that in the Lux case the joint report of the two experts was originally tendered on a broader basis than has occurred in the case before me. It also appears that the respondents had gone into evidence and, before 9 April 2003, when the respondents said they were no longer going to call Mr Wolowski, the applicant had made forensic decisions in relation to that evidence. In my view, the Lux decision does not suggest that the approach I have taken should be qualified.

38    I note for completeness that in the substantive judgment in the Lux case, Australian Competition and Consumer Commission v Lux Pty Ltd [2004] FCA 926, Associate Professor Hayes was called by the respondents as an expert in place of Mr Wolowski. And, again, in the final result, RD Nicholson J said at [73] of the judgment that he was not assisted by the report of Ms Murphy.

39    For these reasons, I reject the application to exclude or excise the evidence identified in MFI 39.

Associate:

Dated:    11 October 2011