BUTCH PET FOODS LIMITED v MAC MOTORS LIMITED [2018] NZCA 276

BUTCH PET FOODS LIMITED v MAC MOTORS LIMITED [2018] NZCA 276 [27 July 2018]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA137/2018[2018] NZCA 276BETWEEN BUTCH PET FOODS LIMITEDApplicantAND MAC MOTORS LIMITEDRespondentHearing: 11 June 2018Court: Winkelmann, Clifford and Williams JJCounsel: P T Finnigan for ApplicantM Wilkinson as director of RespondentJudgment: 27 July 2018 at 4 pmJUDGMENT OF THE COURTA The application for leave to bring a second appeal is declined.B There is no order for costs.____________________________________________________________________REASONS OF THE COURT(Given by Clifford J)Introduction[1] This is an application for leave to bring a second appeal.Background[2] Butch Pet Foods Ltd uses Hino trucks in its business. Mac Motors Ltd repairedone of Butch's Hino trucks. Some three months later, that truck broke down again.Butch said that breakdown was caused by Mac's faulty repair work. Butch sued Macfor some $32,500 in the District Court. Butch failed.1 Butch appealed to theHigh Court, and (largely) failed again.2 Butch applied to that Court for leave to bringa second appeal to this Court. That application was declined.3[3] Butch now applies to this Court for leave to bring a second appeal.Mac opposes.Second appeals — the law[4] The test for leave to bring a second appeal to this Court is well established.The proposed appeal must raise some question of law or fact capable of bona fide andserious argument, in a case involving some interest, public or private, of sufficientimportance to outweigh the cost and delay of the further appeal.4 On a second appealthis Court is not engaged in the general correction of error. Its primary function is toclarify the law and to determine whether it has been properly construed and appliedby the Court below. It is not every alleged error of law that is of such importance,either generally or to the parties, as to justify further pursuit of litigation which hasalready been twice considered and ruled upon by a court.5Submissions[5] Butch says those tests are satisfied here: the question of law involved is theway in which judges must determine conflicts of evidence between experts.[6] In the District Court, Butch's experts said the breakdown was caused by theway in which Mac negligently failed to properly tighten a series of bolts forming partof the flywheel housing: the bolts had subsequently come loose, which in turn causedthe flywheel and clutch housing to fail.1 Butch Pet Foods Ltd v Mac Motors Ltd [2017] NZDC 2826.2 Butch Pet Foods Ltd v Mac Motors Ltd [2017] NZHC 2473.3 Butch Pet Foods Ltd v Mac Motors Ltd [2018] NZHC 198.4 Cuff v Broadlands Finance Ltd [1987] 2 NZLR 343 (CA) at 346–347.5 Waller v Hider [1998] 1 NZLR 412 (CA) at 413.[7] Mac's experts said the cause of the flywheel and clutch assembly failing wasthe way a Butch employee had driven the Hino truck, regularly "stall stopping".Driving that way had, over time, exposed the flywheel bolts to severe stress. On theday in question they had all failed simultaneously. There was no evidence the boltshad not been tightened by Mac properly.[8] In applying for leave to bring a second appeal Butch says that, in preferring theevidence of Mac's experts, the Judge failed to engage with the evidence. Rather, shehad made unjustified, general, findings of credibility and reliability. She had not giventhe required reasoned account as to why the approach of Mac's experts was to bepreferred over those of Butch's experts.The expert evidence[9] Butch called three experts:(a) Mr Paul Barton — an experienced automotive mechanic;(b) Mr Peter Cress — the general manager for Hino trucks in Auckland andan experienced automotive mechanic; and(c) Mr Peter Wilcox — a metallurgist.[10] Butch's experts gave evidence that the bolts had been torqued incorrectly, thatis under tightened. As a result, they had loosened, damaging the flywheel andcrankshaft joint until they all sheared.[11] Mr Wilcox also suggested that a transport bolt had been left in place afterthe respondent had reinstalled the clutch: the presence of that had caused/contributedto the vibration, loosening and then shearing.[12] Mac called two experts:(a) Mr Timothy Smithson — an experienced automotive engineer; and(b) Dr Jonathan Smith — a metallurgist.[13] Mac's experts disputed the incorrect torquing of the flywheel theory. They alsogave evidence that, even if a transport bolt had been left in, it could not haveoccasioned such a vibration as to cause all of the flywheel bolts to loosen and thenshear off. The cause was instead shock loading from driver abuse.[14] That proposition was put to Mr Cress when he gave his evidence in chief. Hisview was that it was "highly unlikely" that was the cause of what had happened.[15] Both parties called a number of other witnesses, but their evidence was notchallenged.Question of law or fact capable of bona fide and serious argument?First and third grounds[16] The first proposed ground of appeal is that the Judge was required to provideadequate and cogent reasons to support the strong adverse credibility findings madeagainst Mr Barton and Mr Wilcox, and had not done so. The third proposed groundof appeal is that Judge Sharp failed to coherently reason why one set of witnessesshould be preferred to the other set of witnesses.[17] Butch says there was no rational reason for the Judge to prefer Mac's witnesses.In particular, Mr Barton's evidence was criticised by Mr Smithson for not identifyingthe root of the problem. But, Mr Barton had greater experience than Mr Smithson.[18] The Judge was also wrong to criticise Mr Wilcox's evidence for being outsidehis field of expertise. It was not.[19] As those grounds overlap, we address them together.[20] Both grounds are advanced by reference to the English Court of Appeal'sdecision in to English v Emery Reimbold & Strick Ltd.6 In that case, the EnglishCourt of Appeal noted:7 we are concerned [with] conflicts of expert evidence. In FlanneryHenry LJ quoted from the judgment of Bingham LJ in Eckersley v Binnie(1988) 18 Con LR 1 at 77–8 in which he said that "a coherent reasonedopinion expressed by a suitably qualified expert should be the subject of acoherent reasoned rebuttal". This does not mean that the judgment shouldcontain a passage which suggests that the Judge has applied the same, or evena superior, degree of expertise to that displayed by the witness. He shouldsimply provide an explanation as to why he has accepted the evidence of oneexpert and rejected that of another. It may be that the evidence of one or theother accorded more satisfactorily with facts found by the Judge. It may bethat the explanation of one was more inherently credible than that of the other.It may simply be that one was better qualified, or manifestly more objective,than the other. Whatever the explanation may be, it should be apparent fromthe judgment.[21] In the present case, the Judge provided a very careful assessment of Mr Bartonand Mr Wilcox's evidence at [42] to [61] of her judgment.[22] From that analysis, it is evident that Judge Sharp had a number of reasons forpreferring the respondent's witnesses over Mr Barton and Mr Wilcox. As relevant,they include that Messrs Barton and Wilcox:(a) failed to be objective (at [43]);(b) lacked expertise/training (at [44]);(c) failed to adhere to expert's code of conduct (at [43]);(d) made statements lacking scientific evidence to support them(at [46]–[47]).[23] At the same time, the Judge noted instances where Mr Barton and Mr Wilcox'sviews were at odds with the evidence before the court, and in particular, whereDr Smith's evidence as to causality was persuasive.6 English v Emery Reimbold & Strick Ltd [2002] EWCA Div 605, [2002] 1 WLR 2409.7 At [20].[24] In our view, the Judge has given extensive reasons for preferringthe respondent's witnesses over Messrs Barton and Wilson, which fulfils herobligation to resolve that conflict of expert evidence. The Judge may not herself haveengaged directly with the technical aspects of the difference in the experts' evidence.But, as the decision in English v Emery Reimbold & Strick Ltd makes clear, she wasnot required to.8 After all, expert evidence is given to the Court because the Court isnot an expert. Often, to reconcile the technical aspects of differing experts' viewswould require a third expert to give her opinion as to the correct outcome. The Judge'sreasons for preferring certain experts' evidence over others are well explained in herjudgment, and meet the criteria described in English v Emery Reimbold & Strick Ltd.Second ground — Mr Cress' evidence[25] The second proposed ground of Butch's appeal is that Judge Sharp wasrequired to deal with, and not disregard, the evidence of Mr Cress that driver-abusewould not cause adequately tightened flywheel bolts to loosen and unwind. Thatevidence, Mr Finnigan argued on behalf of Butch, was cogent, reasoned and impartial.While the respondent's witness Dr Smith gave evidence that he disagreed with MrCress' assessment, Dr Smith did not give reasons for that disagreement. Thus it wasnot enough for the Judge simply to "prefer" Dr Smith's view.[26] Did Judge Sharp deal with Mr Cress' evidence appropriately?[27] In his written statement, Mr Cress focused on the alleged failure to remove thetransport bolt. In evidence-in-chief, he was also asked whether, as Dr Smith hadopined, the "stopping/starting" practice could "have caused the problem". As noted,Mr Cress said that was "highly unlikely". Mr Cress acknowledged that the practice ofcrash starting the truck, without using the starter motor, and stopping the truck bystalling it through engaging a high gear, did occur. But, he said, the torque throughthe drivetrain produced by that practice was minimal compared to that which occurredwhen the engine was going uphill in an appropriate gear. Hence his "highly unlikely"view.8 At [20].[28] Dr Smith's written statement dated 4 February 2016 concluded:23. The shock loading applied in this case was caused by the driver[applying] a repeated dead shock loading by dropping the clutch and causingthe engine to stall. Each cycle of dead shock loading produced stresses thatthe engine flywheel assembly are designed to resist and the abuse of thevehicle was the primary cause of failure. The inertia mass of the flywheel andcrankshaft combined caused by rapid deceleration would generate very largeforces.24. The physical evidence is consistent with the above failure scenario.The vehicle having travelled more than 18000 kms since the clutch wasreplaced. In the event that failure was due to lack of clamping force beingapplied then it would be expected that failure would occur in a significantlyshorter period of time and lower total mileage accumulation. The physicalevidence shows that the failure was rapid and this shows that failure initiationand damage processes occurred relatively late in the total mileageaccumulation after service by [Mac]. If the bolt clamping forces had beeninsufficient then failure would have progressed slowly and the fracturemorphology of the bolts would have been different and there would be noevidence of shock loading.[29] Mr Finnigan put Mr Cress' "highly unlikely" assessment of "stall stopping"and "crash starting" being the cause of the failure to Dr Smith duringcross-examination. The following exchange occurred:A I disagree with that analysis.Q But you've got no trucking experience have you?A No, no in terms of loading I think I can give an opinion and I disagreewith that analysis completely.The CourtQ Can you tell me why you disagree?A Well I think in terms of it's a very one sided assessment in terms ofstop shock, dropping a clutch would produce a severe load throughthe drivetrain and that is the only thing I can see that would cause areverse bending failure in this particular case so I think the causation,I think shock loading is the only [equivocal] cause and I can see theonly cause of that being applying a severe shock to the drivetrainsystem.Q But this vehicle lasted three months, 18,000 kilometres after the repairof Mac Motors. Surely if your shock loading evidence is to beaccepted, it would have occurred much earlier, the failure?A No. No. I mean obviously each damage, each cycle of what we calldropping the clutch, would produce damage and if you do enoughcycles then that damage will be accumulative and then if you do iteven more times, eventually a crack will initiate and then you'llinitiate the failure process.[30] Further questions from the Court and Mr Finnigan followed, with Dr Smithmaintaining his position.[31] Mr Cress' more general evidence was also put to Dr Smith incross-examination many times.[32] Each time, Dr Smith stated that he disagreed with it. When pressed, he said itwas "a very one-sided assessment", "just supposition" and did not "fit the physicalevidence". Shock loading was "the only cause".[33] Butch's submission — that Dr Smith did not give any reasons for disagreeingwith Mr Cress' "reasoned opinion" — is unfounded.[34] Butch is left with the general submission that the Judge failed to deal with theevidence of Mr Cress that driver-abuse would not cause adequately tightened flywheelbolts to loosen and unwind. The Judge's questions of Dr Smith during the trialdemonstrate her engagement on the point. Moreover, and as the Judge noted, Dr Smithdisagreed with Mr Cress.9 The Judge accepted Dr Smith's evidence.10 Mr Cress'evidence was rejected because it was in conflict with evidence that the Judgedetermined was to be preferred. The Judge did engage with and explain why she didnot accept Mr Cress' evidence.Other considerations[35] Even if there had been some inadequacy in the way Judge reasoned, there areother, important reasons why this is not a matter appropriate for a second appeal. Theamount involved is relatively small. The parties have had an extensive factual inquirybefore the District Court: the hearing occupied nine days, over a period of three weeks(19 January to 13 February) and generated a transcript of over 700 pages of evidence.Brewer J, in turn, provided an exhaustive analysis of the facts, a careful considerationof the law and a carefully reasoned judgment.9 Butch Pet Foods Ltd, above n 1, at [53].10 At [57].[36] Further inquiry into this essentially factual dispute would not, in thesecircumstances, be an appropriate use of this Court's time and resources.Result[37] The application for leave to bring a second appeal is declined.[38] Mac has been represented by its director, Mr Wilkinson, throughout. There istherefore no order for costs.Solicitors:Romaniuk & Associates, Auckland for Applicant