The recent Federal Court of Appeal decision in New Aim Pty Ltd v Leung [2023] FCAFC 67 offers illuminating insights into the permissible conduct for legal practitioners with regards to instructing experts in a court case, setting a notable precedent for future considerations.
Case Overview
The case centres around New Aim Pty Ltd, a large Australian online retail business, which alleged that its former employee, Leung, had unlawfully retained and supplied confidential contact details of its Chinese suppliers to competitors. The allegations raised against Leung involved breach of confidence, breach of employment contract, and contravention of section 183 of the Corporations Act.
To strengthen its argument, New Aim Pty Ltd engaged an independent expert, Ms Chen, on the advice of Corrs Chambers Westgarth. The objective was to ascertain the confidentiality status of the disputed information by obtaining a more thorough understanding of the Chinese goods supplier industry.
Primary Judge’s Verdict and Rationale
Contrary to expectations, the Primary Judge determined that the supposedly confidential information was not, in fact, confidential. He rejected the expert evidence, citing concerns over the perceived lack of honesty and independence in the expressed opinions. The reasons specified included:
- The undisclosed preparation methodology of the expert report.
- The non-disclosure of all correspondence tied to the report's preparation.
- The failure to record and reveal any oral advice given by the legal practitioner to the expert.
- The misleading actions during the report's production and delivery, particularly concerning the timeline of the instructions and the report’s delivery.
- The involvement of legal practitioners in drafting the expert report, which questioned the expert's independence.
- An unconvincing affirmation of the independence and honesty of the expressed opinions.
Court of Appeal’s Determination
Upon appeal, the Court established that the Primary Judge had made errors in his judgment. According to the Court of Appeal, the fundamental responsibility of lawyers is to refrain from influencing a witness's evidence. While lawyers may participate in drafting expert evidence, this should solely capture the expert's communication or assumed facts.
The Court clarified that there was no legal mandate to reveal all correspondence or document oral advice, although ethical obligations might necessitate such disclosures depending on the circumstances.
Concerning expert instructions, the Court pointed out that final instructions typically arrive shortly before the report's completion. It dismissed the Primary Judge's allegation that the conduct was misleading, arguing that FCR 23 necessitates that experts address the specific question posed, rather than all queries made during the retainer.
The Court also criticised the Primary Judge's wholesale rejection of the expert's evidence without sufficient explanation, particularly as it seemed much of the factual evidence had been dismissed.
Key Insights
This landmark judgement underscores the importance of understanding the nuances involved in preparing and presenting expert evidence, as well as the obligations regarding confidential information, employment contracts, and corporate law. It sheds light on the role of lawyers in preparing expert evidence.
While the Court of Appeal’s ruling stresses that there is no explicit legal requirement for specific actions, such as documenting all correspondences or instructions to experts, it does acknowledge the existence of ethical obligations that need consideration. Lawyers' key duty is not to suggest the evidence that an expert witness should provide. However, this does not imply that lawyers cannot draft the factual context based on the expert's communication or provide assumptions for the expert to formulate an opinion on, creating a nuanced understanding of lawyers' roles in court cases.