Bastion Pty Ltd v Cooper & Cooper [1990] QSCFC 14

\°7 9" Ad IN THE SUPREME COURT OF QUEENSLAND go 0(4- I REVISED COPIES ISSUED Court Reporting Bureau Date-. (I / ^ / qo FULL COURT No. 108 of 1988 10 BEFORE: Mr. Justice Kelly S.P.J Mr. Justice Derrington Mr. Justice Carter BRISBANE, 29 MARCH 1990 10 (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Chief Court Reporter,Court Reporting Bureau.) 20 BETWEEN: 20 BASTION PTY. LTD. (Plaintiff) Appellant -and- 30 WALTER JOHN COOPER and EVA MARGARET COOPER (Defendants) Respondents 30 JUDGMENT 40 50 MR. JUSTICE KELLY:' In my opinion the appeal should be dismissed with costs. 1 publish my reasons. MR. JUSTICE DERRINGTON: 1 agree. 1 publish my reasons. MR. JUSTICE CARTER: I agree that the appeal should be dismissed with costs and 1 agree with the reasons published by Mr. Justice Kelly and Mr. Justice Derrington. MR. JUSTICE KELLY: The order of the court is that the appeal is dismissed with costs. I 60 40 50 60 'iter, Qid. -1- [1990] QSCFC 14 -- 1 of 15 -- PC qcj'Ol 4- l IN THE SUPREME OF QUEENSLAND FULL COURT BETWEEN ; AND COURT WRIT NO. 108 OF 1988 BASTION PTY . LTD (Plaintiff) Appellant WALTER JOHN COOPER and EVA MARGARET COOPER (Defendants) Respondents KELLY SPJ DERRINGTON J CARTER J Reasons for Judgment delivered by Kelly SPJ and Derrington J on the 29th March, 1990 Carter J agreeing with both reasons and the order made . Appeal dismissed with costs -- 2 of 15 -- IN THE SUPREME COURT OF QUEENSLAND FULL COURT No. 108 of 1988 Before the Full Court Mr. Justice Kelly S.P.J. Mr. Justice Derrington Mr. Justice Carter BETWEEN : BASTION PTY . LTD. ( Plaintiff ) Appellant and WALTER JOHN COOPER and EVA MARGARET COOPER (Defendants ) Respondents JUDGMENT - KELLY S.P.J. Delivered the day of '3 1990. CATCHWORDS : Counsel: S.D. Rapoport for appellant A.M. Warnick for respondent Solicitors: Watkins Stokes t/a for Connolly & Associates for appellant Charlton Muller & Jones for respondent Hearing date: 5th March, 1990. -- 3 of 15 -- IN THE SUPREME COURT OF QUEENSLAND FULL COURT NO. 108 Of 1988 BETWEEN : BASTION PTY. LTD. (Plaintiff) Appellant - and - WALTER JOHN COOPER and EVA MARGARET COOPER (Defendants) Respondents JUDGMENT - KELLY S.P.J. Delivered the day of 1990. I have had the advantage of reading the reasons for judgment prepared by Derrington J. I agree in general with the reasoning which led him to conclude that the appeal should be dismissed. A number of the grounds of appeal involved challenging findings of fact made by the learned trial judge which depended upon either his findings based upon credibility or, apart from that, the view which he took as to the weight to be given to the evidence of certain witnesses. These are essentially matters for the trial judge and in my view nothing has been made to appear which would bring this case into the rather limited category of cases whether an appellate court is prepared to disturb such findings. This then disposes of grounds 2, 4, 6, 7, 8, 10 and 11 . As to the remaining grounds, I am of the same view as Derrington J. as to the reasons why ground 1 fails. The complaint in ground 3 has no substance . The remark made by the learned judge as to pleading ex. 3 was justified on the basis -- 4 of 15 -- 2 that it was only when para. 4(a) was inserted in the statement of claim by way of amendment that this document was relied upon as an express representation of gross takings and net profits; ground 5 therefore fails. Ground 9 does not require consideration, as whether or not the learned judge was correct in deciding not to assess damages, this is not now a matter of concern. Ground 12 fails for the reason that there is nothing to suggest that the learned judge pre-judged the issues or that in any way the plaintiff did not have a fair trial. I would dismiss the appeal with costs. -- 5 of 15 -- IN THE SUPREME COURT OF QUEENSLAND No. 108 Of 1988 Before the Full Court Before Mr. Justice Kelly S.P.J. Before Mr. Justice Derrington Before Mr. Justice Carter BETWEEN: BASTION PTY. LTD. (Plaintiff) Appellant - and - WALTER JOHN COOPER and EVA MARGARET COOPER (Defendants) Respondents JUDGMENT - DERRINGTON J. Delivered the 29th day of March, 1990. CATCHWORDS .* Counsel: S.D. Rapoport for the appellant. A.M. Warnick for the respondent. Solicitors: Watkins Stokes t/a Connolly & Associates for the appellant . Charlton Muller & Jones for the respondent. Hearing dates: 5th March, 1990. -- 6 of 15 -- IN THE SUPREME COURT OF QUEENSLAND No. 108 of 1988 FULL COURT BETWEEN : BASTION PTY. LTD. (Plaintiff) Appellant - and - WALTER JOHN COOPER and EVA MARGARET COOPER (Defendants) Respondents JUDGMENT - DERRINGTON J. Delivered the 29th day of March, 1990. This is an appeal from the dismissal of the plaintiff's action for damages for fraud, breach of warranty and negligent misstatement in the sale by the defendants to the plaintiff of the lease, licence and goodwill of a hotel business. The outcome of the trial depended essentially on questions of credit and it may be said in summary that the trial judge preferred by far the evidence of the defendants and their witnesses. The first ground of appeal challenges the admission into evidence of a memorandum of a note made by a telephonist in the office of the defendants' solicitors and directed to the practitioner having control of the preparation of contract documents for the sale on the instructions of the defendants. It said that Mr. Cooper advised of an alteration to a relevant date in the draft documents which had been prepared. The document was obviously a business record and although the person who made it was not called, no objection seems to have been taken on that ground, and probably rightly so because that -- 7 of 15 -- 2 would have been an unnecessary formality. Consequently, it is admissible under s. 92 of the Evidence Act 1977 subject to the admissibility of oral evidence as to the material contained in it. It is this which is at the root of the ground of appeal because it is argued that the contents were merely hearsay and therefore inadmissible. That it not correct. From its contents it manifestly did not purport to speak of the truth of the communication made by Mr. Cooper. Its relevance was in the fact that he gave such instructions at that time, that is, it is original evidence of the fact that that instruction was given rather than hearsay as to the truth of the contents of it: see Cross on Evidence 3rd ed. Aust. ed. para. 16.10. R . v . Clune (No. 1) 1975 V.R. 723 at 731. This ground must fail. In a substantial number of other grounds the appellant relies upon argument as to the comparative weight of the evidence of the respective witnesses of each side, complaints that the learned trial Judge did not pay sufficient weight to "independent evidence", Voulis v. Kozary (1975) 7 A.L.R. 126; (1975) 50 A.L.J.R. 59 and submissions that inferences should or should not have been drawn as they were drawn by him. It is certainly true that an Appeal Court may overturn a trial Judge's findings of fact based upon the weight of evidence, Tavlor v. Johnson (1983) 151 C.L.R. 422; (1982-83) 45 A.L.R. 265; Karabotsos v. Plastex Industries Ptv. Ltd. (1981) V.R. 675; but it will certainly not do lightly: Warren v, Coombes (1979) 142 C.L.R. 531; (1979) 23 A.L.R. 405; Uranerz (Aust.) Ptv. Ltd, v. Hale (1980) 54 A.L.J.R. 378; Barclay Bros. Pty. Ltd, v. Liaris -- 8 of 15 -- 3 (1981) 56 F.L.R. 436; Brunskill v. Sovereign Marine & General Insurance Co. Ptv. Ltd. (1985) 59 A.L.J.R. 842; 62 A.L.R. 53; Baumgartner v. Baumgartner (1988) 76 A.L.R. 75; (1987) 164 C.L.R. 137; (1987) 62 A.L.J.R. 29; Watt or Thomas v. Watt [1947] A.C. 484 487-488; and even more respect will be given to the view of the trial Judge when, as here, the weight of evidence depends upon his assessment of the credibility of the witnesses both as to accuracy and honesty: Savanoff v. Re-Car Ptv. Limited (1983) 2 Q.R. 219, 227; R. v. Free (1983) 2 Q.R. 183, 191; Proestos v, Canberra Rex. Ptv, Ltd. (1985) 75 F.L.R. 69; Semple v. Nominal Defendant (1971) 45 A.L.J.R. 713. This of course extends to the evidence of independent witnesses for such witnesses may not be truly independent or even if they were they can be in error. It is still open to the trial Judge to reject their evidence on a particular matter in favour of a witness who has an interest in the outcome, depending upon his view of the effect of the evidence as a whole upon the disputed point; or he may simply prefer the quality of the evidence of the interested party notwithstanding that interest; or he may regard the issue as insignificant in the total case or outweighed by other factors. As to each of the implications which as it was said should have been drawn, it is manifest that the implication proposed was only one possible hypothesis while others were clearly open and, in some cases, at least as forceful as, if not more so, than that proposed by the appellant. For example, it is not possible to draw a conclusive or even a weighty inference as to what Mr. Cliff Baty, on being present when it was produced, would have done in respect of the profit and loss statement of the hotel. -- 9 of 15 -- 4 Because of the limited period which it covered, the availability to him of the trading figures for a much longer period prior to that time, and perhaps other knowledge, he may not have had the need to exhibit any such interest at that time. From the circumstances it is certainly not open to infer the probability that he would have inspected them. Another ground of appeal was that no reasons were given for the implied rejection of the evidence of certain of the "independent witnesses" where it conflicted with that of the defendants, and that there is some significance in the absence of any reasons advanced by the respondents as to why those witnesses should be disbelieved. Reference was made to some sample authorities where such reasons were given by the Court, but that does not mean that in every case an explicit and detailed explanation should be advanced for the preference of one witness over another. Such a preference does not imply the rejection of the evidence of the unpreferred one but merely that, on the whole of the evidence, of the two the preferred one is that which should be adopted. It sometimes may be that it is very difficult to find the reason why an independent witness has given his evidence as he did. It may simply be that other evidence and the probabilities generally weigh against him. Where there is other evidence, and particularly evidence of an objective nature, which strongly supports an independent witness then no doubt it would be highly desirable to explain the reasons for the rejection of it; but where it is simply the weight of the evidence as a whole which leads in a particular direction, it is not necessary for the trial Judge to spell out -- 10 of 15 -- 5 in detail his reasons for coming down in one direction Proestos v. Canberra Rex. Ptv. Ltd. (1985) 75 F.L.R. 69. It is sufficient if his reasons for judgment make it sufficiently clear how he came to his decision and it is not necessary that he resolve every conflict, no matter how minor. In the present case the learned trial Judge has made abundantly clear the powerful reasons which led to his conclusion and the resolution of any subsidiary conflict may well be inferred in the light of the statement of the major grounds of his conclusions. Next he is said to have been wrong in asserting that, if the appellant's case were genuine, then reference to a very significant exhibit "should have appeared in the pleadings much earlier" than in the amended statement of claim which appeared at a late stage prior to trial. It is correctly pointed out by the appellant that the exhibit is referred to in another passage in the original statement of claim, but this misses the point. That earlier reference was oblique, being merely a fortifying reference to an allegation made in respect of another issue. His Honour's reference was clearly directed at the plaintiff's failure to plead the exhibit as the direct source and the cause of a serious further misrepresentation of another nature which was raised in the amendment. The remark was directed not to the mere absence of mention of the document but to the nomination of it as the central point of the cause of action which was based upon it. His Honour's observations, properly understood, are well justified. Prior to the amendment to the statement of claim, the allegations of fraud related to other subject matter including -- 11 of 15 -- 6 the weekly takings of the business by the defendants. As it turns out, it appears that if such a representation had been made, it would have been true, for the takings by the appellant during the same season after the sale amounted to at least the figure alleged. It was only as the action advanced towards trial that the plaintiff then amended its claim to alleged totally different representation based upon the same document which had been mentioned earlier only as confirmation that the representation as to takings was made as alleged. This was a surprisingly late allegation if that document had always been a significant means of a further misrepresentation as it was alleged at the trial. It is this to which His Honour was adverting, and with good reason. It does not diminish the point that he was making that in its pleadings the plaintiff had originally referred it to the document merely as a support to its allegation as to the different representation which was pleaded at that time. Another complaint of the appellant was that the learned trial Judge was wrong in finding that a witness was candid, honest and truthful when there was evidence that her income tax returns for two years were understated. However, a factor of discredit like that does not necessarily destroy the credibility of a witness in the eyes of the Court for all times. Needless to say when the dishonesty as to the taxation returns was demonstrated, the learned trial Judge must have taken that matter into account; but that certainly does not mean that in respect of her sworn testimony, tested by cross-examination under his -- 12 of 15 -- 7 scrutiny, he could not have come to the conclusion that she was as he described. Complaints were also directed at a number of his observations of which it is said that they did not accord with the evidence. It is not necessary to consider these in special detail because in some cases they were no more than observations made for the purpose of providing a generally complete picture but aside from that they were irrelevant to the decisive issues. Otherwise, and without the necessity of deciding whether he suffered misapprehension as to any features, if it were so they were manifestly insignificant in relation to the contrary factors which were decisive. It is also alleged that the learned trial Judge wrongly formed an unfavourable impression of the major witness for the plaintiff and that this coloured his conclusions and affected his appreciation of the evidence of other witnesses. He certainly formed a very unfavourable impression of that witness as revealed by his judgment, and it was open to him to do so. Presumably the complaint is that he formed this impression too early and without sufficient cause to that point. The manifestations of the learned Judge's involvement during cross-examination of this witness which are relied upon by the appellant do not support that view. It is perfectly proper that he should seek to clarify answers which he found to be unsatisfactory, for this at least allows the witness the opportunity of explanation rather than leaving the trial Judge with an adverse conclusion which would remain entrenched if there were silence R. v. Butler (1953) 53 S.R. (N.S.W.) 328; 70 W.N. 222; X v. Y (No. 2) (1954) V.L.R. 715; -- 13 of 15 -- 8 (1955) A.L.R. 188. Besides, it was open to him to have formed a provisional view as to the credibility of the witness by that time. He had heard the opening, observed the course of pleadings, and heard a substantial part of the witness' evidence. It is not at all surprising that he may have had the opportunity to form provisional doubt about features of the witness' evidence for which he sought further enlightenment through his own questions . This leads into the next complaint that the learned trial Judge pre-judged the issues and did not take proper advantage of having seen and heard the witnesses. There is no indication of this whatever. No doubt some provisional views towards the final result might be formulated at a relatively early stage when the essential features of the case are first understood, but these are always far from fixed and subject to the final assessment on the whole of the evidence. Naturally this will often turn out to be right so that his view remains unchanged in the result, but for that reason the uninformed litigant may believe that the determination of the result took place at the earlier time. Alternatively, in respect of particular issues as distinct from the final result, it is sometimes possible for a trial Judge to be able to formulate an adverse view at an early stage of the trial because he will have heard virtually all the evidence upon that point in the light of the opening or the objective factors or those which are common to both sides and may give a clear indication of the result of those issues. It is often part of a judge's proper interest in the trial to be actively forming provisional views for the purpose of understanding the case and -- 14 of 15 -- 9 testing these against what he hears. He will easily change them when it is proper to do so. This ground is also without substance. Finally it was suggested that the learned trial Judge was in error in failing to assess damages. That is just not an issue here as the appeal must fail and the assessment of damages does not come up for consideration. It is sufficient to say that each point of the appellant has been considered individually for any possible value and where there have been any matters of any substance at all they have been considered cumulatively. Even then they have no weight which could have any serious effect of challenging the very strong factors upon which the decision was made below. The appeal should be dismissed with costs. -- 15 of 15 --