Appeal Rejected: Court Denies Introduction of Additional Evidence

The Court of Appeal dismissed the appellant's application to introduce additional evidence in his appeal, except for a webinar held after the trial, due to the lack of 'special grounds' for introducing evidence available with reasonable diligence at the time of the trial.

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: [NAME] v [NAME] [2020] NSWCA 299 Hearing dates: 17 November 2020 Decision date: 19 November 2020 Before: Leeming JA; Emmett AJA. Decision:

1. Stand over the application to adduce additional evidence, in so far as it concerns evidence of the webinar dated 6 September 2020, to the hearing of the appeal.

2. Otherwise dismiss the notice of motion dated 30 October 2020.

3. Costs reserved. Catchwords: PROCEDURE – additional evidence on appeal – fresh and further evidence – requirement that evidence could not have been obtained with reasonable diligence at trial – application in substance refused Legislation Cited: Patents Act 1990 (Cth) Supreme Court 1970 (NSW), s 75A Cases Cited: [NAME] v [COMPANY] (1994) 34 NSWLR 155 [COMPANY] v [COMPANY] (2013) 86 NSWLR 115; [2013] NSWCA 392 [NAME] v [NAME] [2019] NSWSC 1033 Hassan v Sydney Local Health District [2020] NSWCA 195 [COMPANY] v [NAME] of Canada Bay Council [2010] NSWCA 64 [COMPANY] (receivers and managers appointed) (in liq) v [NAME] [2015] NSWSC 1827 Tjiong v Tjiong [2012] NSWCA 201 Category: Procedural and other rulings Parties: [NAME] (Appellant) [NAME] (First respondent) [NAME] (Second respondent) Representation: Counsel: [redacted] [NAME] SC (First respondent)

Solicitors: [redacted] File Number(s): 2019/285092 Publication restriction: Nil Decision under appeal Court or tribunal: Supreme Court of New South Wales Jurisdiction: Equity Citation: [2019] NSWSC 1033 Date of Decision: 15 August 2019 Before: Parker J File Number(s): 2014/101136

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Judgment 1. THE COURT: Mr [NAME] has appealed from the dismissal of his cross-claim and the relief granted on [NAME]'s claim following a nine day trial before the primary judge, whose judgment of some 477 paragraphs was delivered on 15 August 2019: [NAME] v [NAME] [2019] NSWSC 1033. There is also a cross-appeal and a notice of contention. The appeal is set down for hearing, over two days, in the first week of December 2020. The parties' submissions have been filed and red and black books have been filed and served. The blue books are shortly to be printed.

2. By notice of motion dated 30 October 2020, [NAME] (who, although represented by senior counsel at trial, now appears for himself) seeks orders permitting additional evidence contained in his affidavit of 29 October 2020 to be admitted into evidence in the appeal. The affidavit appears to have been drafted by [NAME] without the assistance of a lawyer. It comprises 75 paragraphs with 30 separate annexures. In large measure, the tenor of the affidavit may be discerned by the first three substantive paragraphs: "I am appealing the decision of Justice Parker, in the court below, on numerous grounds. The fresh evidence that I am presenting to the court in this Affidavit proves that I have not had a fair trial. The insidious and egregious actions by one or possibly more officers of this court shows a series of events that defies belief."

1. It will be sufficient to provide a relatively high level summary of the account given by [NAME] in his affidavit.

1. The first point made by [NAME] is a complaint directed to the first lawyer who had been acting for him in the dispute, in around 2015, which led to Supreme Court litigation in [NAME] v [COMPANY] which, according to [NAME], was settled in around 2016. Some of the documents [NAME] seeks leave to adduce on appeal are emails from his former lawyer in 2017 and 2018. Of them, [NAME] says "I thought that these emails were being put into the evidence before the court. It is now apparent that this was not arranged by my lawyers."

2. The second point concerns a webinar presented by [NAME]'s patent attorneys on 6 September 2020 (well after the conclusion of the trial). [NAME] complains that things were said during the webinar relating to an invention which he says was "completely identical to my invention" and to [NAME] whom he had sought to call as a witness at the trial, in highly unusual circumstances described by the primary judge at [228]-[268]. It should be noted immediately that the webinar post-dated the trial, and although [NAME] said (and we accept) that he sent a USB stick containing the video file to the Court and to the respondents, it does not appear on the file and [NAME] who appeared for the first respondent said that neither he nor his solicitors had received it.

3. A third theme is serious allegations made against the senior counsel who had appeared for [NAME] at trial and who had cross-examined [NAME]. Part of this concerns counsel's cross-examination and submissions to the effect that [NAME] had threatened [NAME] and, for that reason, [NAME] had not given evidence. [NAME] maintains that, in fact, the reason [NAME] did not give evidence was that he was in business with [NAME] and his original solicitor. In support of that submission, he relies on company searches, trade mark applications and domain name registrations. The former date from March and May 2018; the document concerning the domain name does not disclose when it was first registered. [NAME] also seeks to put into evidence documents recording commercial relations between [NAME] and advisors working for him dated from 2010 and 2012.

4. Fourthly, [NAME]'s original lawyer gave evidence in separate proceedings he had brought in the Supreme Court in 2015, which sought to set aside a consent judgment. That application was refused: [COMPANY] (receivers and managers appointed) (in liq) v [NAME] [2015] NSWSC 1827. The former lawyer was cross-examined but the judge hearing the application (Sackar J) accepted her as a witness of truth (at [94]). [NAME] wishes to adduce evidence of an email dated 19 March 2015 which he maintains was incorrect. [NAME] was copied into that email.

5. Fifthly, [NAME] refers to heads of agreement he had signed concerning the exploitation of the technology in South America, and concerning manufacturing in Puerto Rico, in May 2016 and July 2016. He says that royalties were to be paid to him but the contract was never fulfilled because bankruptcy proceedings commenced by [NAME] prevented him from leaving Australia. This all took place in 2016 and 2017.

6. Sixthly, concerning the finding by the primary judge that [NAME] had not adduced evidence of loss, [NAME] maintained that the global magnetic drive pumps market was valued at some $795.9 million in 2018 and sought to rely upon a short report published apparently by a market journalist to that effect on 13 [NAME] 2019. He says that the evidence was objected to but was considered by the primary judge.

7. Seventhly, [NAME] refers to the transcript at trial concerning [NAME]'s evidence by videolink, submitting that it was now known that [NAME] was in an [NAME] with his former lawyer (this is said by reference to the third point above).

8. Eighthly, [NAME] relies upon two documents, both dated 11 October 2001, acknowledging the receipt of $335,000 in loans from [NAME]. The documents are in slightly different form, although both appear to be signed. [NAME] says that he has "recently" located both documents. However, his affidavit does not explain that it was impossible for the documents to have been obtained prior to the trial.

9. Ninthly, [NAME] points to dealings with Australian, European and Russian patents in 2015 and 2016 by [NAME] and [NAME] which he says he has subsequently discovered. Once again, [NAME]'s affidavit does not explain that it was impossible for the documents to have been obtained prior to the trial.

1. It is convenient to put to one side the second point, concerning the 6 September 2020 webinar. Otherwise, the entirety of the additional documents which [NAME] seeks to place before the Court of Appeal when hearing and determining his appeal, none of which were before the primary judge, predate the trial. Some of the documents were known to [NAME] at the time of trial. It may be accepted that, in accordance with [NAME]'s affidavit, there are others which he has only subsequently discovered. But that is not to the point. The ordinary process of an appeal by way of rehearing is for the Court of Appeal to conduct a "real review" of the trial. That includes a review of the evidence which was tendered at trial. Ordinarily, it is not an occasion for a different hearing, based on different evidence adduced for the first time in this Court. Section 75A of the Supreme Court 1970 (NSW) provides for a limited exception to that ordinary course of events. Power to receive further evidence is conferred by s 75A(7). However, that power is qualified by s 75A(8), as follows: "Notwithstanding subsection (7), where the appeal is from a judgment after a trial or hearing on the merits, the Court shall not receive further evidence except on special grounds."

1. Subsection (9) provides that the prohibition in s 75A(8) "does not apply to evidence concerning matters occurring after the trial or hearing".

2. Thus it is clear that, save in relation to the 6 September 2020 webinar, [NAME] needs to establish "special grounds" in order to adduce the additional evidence, all of which pre-dated the trial.

3. In general, three conditions need to be established in order to satisfy the requirement of "special grounds": 1. the evidence could not have been obtained with reasonable diligence for use at the trial; 2. the evidence must be such that there must be a high degree of probability that there would be a different verdict; and 3. the evidence must be credible. [NAME] v [COMPANY] (1994) 34 NSWLR 155 at 160, which has regularly been followed (see for example Tjiong v Tjiong [2012] NSWCA 201 at [166] and Hassan v Sydney Local Health District [2020] NSWCA 195 at [29]). True it is that the conditions identified by [NAME] in [NAME] are general precepts, rather than essential conditions to be applied as rules in every case. As [NAME] explained in [COMPANY] v [NAME] of Canada Bay Council [2010] NSWCA 64 at [6]-[31], they reflect longstanding discretionary constraints associated with the power to admit further evidence on "special grounds".

1. The present is a clear case. Although we mean no disrespect to [NAME], no aspect of his application comes close to establishing that the material now sought to be relied upon could not have been obtained with reasonable diligence for use at the trial. That was the first point made in opposition to the application, and prominently, in the respondent's written submissions. True it is that [NAME], including in his submissions in reply, maintains that some of the documents have only been seen by him a few weeks ago. That of itself is insufficient to establish that the evidence could not have been obtained with reasonable diligence in time to be adduced at trial. This is not a borderline case. There is nothing to suggest that the entirety of the evidence which [NAME] now wishes to adduce before the Court of Appeal, save for the webinar on 6 September 2020 to which s 75A(8) does not apply, was not available with reasonable diligence at the trial if it had been sought to be tendered.

2. That is sufficient to resolve almost the entirety of the application. We would add, however, that we agree with the respondent's submission that in so far as extremely serious allegations of dishonesty and misconduct are made against [NAME], an insufficient basis has been advanced to support such applications.

3. The foregoing does not apply to the webinar of 6 September 2020, for which "special grounds" need not be established. As it happens – and no criticism is intended of [NAME] in this respect – full submissions on the content of that webinar could not be made in any effective way when the application was heard, because copies were not available to the Court or the respondent. After the hearing of the application, during which [NAME] helpfully identified his email of 2 November 2020, a copy of a link to the webinar stick has been located ([NAME]'s email had been directed to a general inquiries address, and had not come to the Registrar's attention). However, it is inappropriate that the members of the Court as presently constituted embark on listening to the webinar in the absence of submissions from the parties. This aspect of the application is best stood over to the hearing of the appeal. If [NAME] seeks to rely upon the webinar, it may be expected that he will identify, in advance of the hearing of the appeal, such portions as are relevant and the conclusions which he wishes to draw.

4. Finally, the Court raised shortly in advance of the hearing whether the prohibition in s 7(5) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) might apply to the appeal. Ordinarily, this Court cannot hear an appeal involving a matter arising under the Patents Act 1990 (Cth). Part of [NAME]'s dispute concerns the lapsing of patents and one way in which the damages he seeks are quantified is by reference to lost earnings from his invention. Nonetheless, the case is essentially contractual, and the essential terms of the contract are not linked to the rights conferred by the Patents Act in the way that was held in [COMPANY] v [COMPANY] (2013) 86 NSWLR 115; [2013] NSWCA 392 to engage the prohibition. The first respondent denied that s 7 applied, while [NAME]'s position was neutral. Our present view is that s 7(5) does not apply, such that the hearing in December 2020 may proceed. 5. [ADDRESS]'s orders are:

3. Costs reserved.

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Amendments 20 November 2020 - Representation field on cover sheet corrected. 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: 20 November 2020