MARK SPENCER GRANGER V W HOLLIDAY & SONS LIMITED HC PMN CIV 2007-454-102

MARK SPENCER GRANGER V W HOLLIDAY & SONS LIMITED HC PMN CIV 2007-454-102 15 October 2007IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY CIV 2007-454-102BETWEEN MARK SPENCER GRANGER Appellant AND W HOLLIDAY & SONS LIMITED Respondent Hearing: 3 August 2007 Appearances: J Reardon for Appellant Mr and Mrs Holliday in person for the Respondent Judgment: 15 October 2007 at 12.15 pmJUDGMENT OF MALLON J ContentsIntroduction ...........................................................................................................[1] The causes of action...............................................................................................[6] The fact evidence...................................................................................................[9] The expert evidence.............................................................................................[26] The District Court's decision ...............................................................................[31] The appeal grounds..............................................................................................[38]Mr Holliday not independent ...............................................................................[39]Mr Holliday had not recently inspected the chest .................................................[41]The two independent experts agreed ....................................................................[42]No notice of Mr Holliday's evidence....................................................................[46]No cross-examination of experts ..........................................................................[54]Reliance on unsworn statement ............................................................................[68]No finding on value..............................................................................................[74]Overall ................................................................................................................[81] Result ..................................................................................................................[82]Introduction[1] This is an appeal from a decision of the District Court that dismissed Mr Granger's claim for damages against W Holliday and Sons Limited ("Hollidays"). The claim relates to a bombé-shaped chest (an elegant and decorative chest of drawers) purchased by Mr Granger from Hollidays. Mr Granger alleges that representations were made by Hollidays about the chest on which he relied in purchasing it. Subsequently advice was received that these representations were not correct. He claims what he alleges to be the difference between the true value of the chest and what was represented to him. On this basis the claim is a conventional one for misrepresentation and breach of contract. [2] But there are some unusual aspects of the claim. The chest was bought from Hollidays by Mr Granger more than 15 years ago for $12,000, although Mr Granger understood from the representations that the chest was worth more than this. Three years after purchasing it, Mr Granger sold the chest to friends (Mr and Mrs Farquhar). This sale was by way of an exchange of the chest in lieu of cash for a real estate commission of $12,000 which Mr Granger owed to Mrs Farquhar. At this time Mr Granger was unaware that the representations were not correct (as he now believes). Mr Granger's claimed loss arises not from the price at which he on-sold the chest (which was for the same price as he had paid Hollidays), but from a settlement of $45,000 he later entered into with Mr and Mrs Farquhar when they made a claim against him. That claim was made by the Farquhars when were disappointed to be told that the chest was not as had been represented by Hollidays when Mr Granger purchased it. [3] It is not clear what the legal basis for the Farquhar's claim against Mr Granger was given that the alleged misrepresentations were made in relation to Mr Granger's purchase, and not by Mr Granger when selling the chest to his friends. The loss claimed in this proceeding is $42,000 (not the $45,000 settlement sum). Mr and Mrs Farquhar have not yet required Mr Granger to pay the settlement sum or any other sum and were in any event only entitled to $12,000 from Mr Granger when they received the chest instead of cash.[4] The District Court Judge did not have to consider these unusual aspects of the claim, commenting only that the settlement was for "a surprising sum", because he found that Mr Granger had not established that the age of the chest had been misrepresented by Hollidays. Mr Granger's claim was dismissed on this basis. In this appeal Mr Granger seeks a retrial on the basis of irrationality and unfairness in how the Judge treated the expert evidence relating to the chest and for failing to address what is said to be a central question in the case, namely whether Mr Holliday misrepresented the value of the chest. [5] For reasons that follow I decline to order a retrial. The Judge's decision was not irrational and unfair. There was no need to address the question of value or, if there was, Mr Granger has not established that he suffered loss as a result of any such misrepresentation.The causes of action[6] The statement of claim pleads two causes of action. The first cause of action is in contract. It is alleged that because the chest was described on the invoice as a "a 19th century tulip wood walnut bombé chest" there was an implied condition in the contract that the chest corresponded with that description. It is alleged that the chest is in fact a modern reproduction manufactured in the second quarter of the 20thcentury or later. Damages of $42,000 are claimed. That sum is said to be the difference in value between the actual value of the chest and the value of the chest that Mr Granger contracted to receive. [7] The second cause of action is for damages under the Contractual Remedies Act 1979 for misrepresentation. The alleged misrepresentations are: a) "That the chest was a genuine antique" (representation 1); b) "That chests of the same type were achieving between £8000 – £10,000 in England" (representation 2); c) "That it was a 19th century tulip wood and walnut bombé chest".[8] It is alleged that representation 1 was intended to mean that the chest was at least 100 years old and was not a modern reproduction made in the 20th century. Representation 2 was intended to reinforce representation 1 and establish that the chest had a value greater than a modern reproduction made in the 20 th century. As with the first cause of action the sum claimed is $42,000 on the basis that this is the difference in value between the chest's actual value and the value of the chest had the misrepresentations been true.The fact evidence[9] The chest was purchased in June 1992 from Hollidays by a Mr Cranshaw on behalf of Mr Granger (with whom at that time Mr Cranshaw had some business association). Mr Cranshaw was an experienced antique purchaser and has known and dealt with Mr Holliday over a number of years both before and after 1992. The chest was part of a consignment of furniture being sold by Hollidays on behalf of a trust. Some years earlier the chest had been imported by Hollidays and sold to the trust for NZ $17,600. [10] The chest was one of a number of items purchased by Mr Cranshaw during a weekend trip to Christchurch (though the only item he purchased for Mr Granger). Mr Granger was not present on this trip. Mr and Mrs Farquhar accompanied Mr Cranshaw and his wife and others on the trip. The Farquhars were not directly involved in the negotiations over the items purchased by Mr Cranshaw. The relevant discussions in which the representations are said to have been made are therefore those between Mr Cranshaw and Mr Holliday and then what Mr Cranshaw said to Mr Granger about these discussions. [11] Mr Holliday and Mr Cranshaw agree they discussed that the chest and the other items that were part of the consignment were available for a good price and that they discussed the price at which the trust had purchased the chest. They agree that Mr Holliday described the chest as a 19th century tulip and walnut bombé commode or French chest. Beyond those matters, they disagree as to what was said.[12] Mr Cranshaw's evidence was that Mr Holliday told him the chest was a "19 thcentury antique" and that he made it clear that he was not interested in buying anything other than "genuine antiques". He said that Mr Holliday told him the chest would sell for £8 – 10,000 in the United Kingdom and that the previous owner of the chest had paid in excess of NZ $20,000 for it. He said he wrote £8 – 10,000 on the back of his cheque at the time of the discussions. This notation was produced to the Court. [13] Mr Holliday denies saying these things. Mr Holliday says he described it as being 19th century – not that it was an "antique" or a "genuine antique". He says that he and Mr Cranshaw looked at books and guides in his library and that Mr Cranshaw was a canny buyer and wanted to know what he was buying. He says that he also had the original paperwork from the purchase by the trust and he thinks he probably got this out for Mr Cranshaw. He believes he told Mr Cranshaw that the price paid by the trust was $17,600. He says he did not say the chest would sell for £8 - 10,000 in the UK as there was nothing in his books and guides that would support that. [14] When Mr Cranshaw rang Mr Granger to discuss purchasing the chest Mr Cranshaw's evidence was that he said:"I told him about the situation with the consignment of furniture, and how it may be possible to buy the piece for approximately half of its value. I described to my business partner Mr Granger, the features of the chest as described to me, including that it was a French 19th century tulipwood and walnut bombé chest."[15] Mr Granger's evidence was that he was told:"[i]t was an antique bombé chest that Mr Holliday said was 19th century and had a value in the United Kingdom of between £8,000 – £10,000 and that I could get it for substantially less than this because of the depressed antique market".[16] Based on this description Mr Granger, who is not experienced in antiques, said he understood the chest was made somewhere between 1801 and 1899 and that he was getting a real bargain. He agreed to buy the chest and, on Mr Granger's behalf, Mr Cranshaw agreed to a purchase price of $12,000. The invoice described the chest as a "19th century tulipwood and walnut bombé chest".[17] Mr Farquhar says that he was aware that Mr Cranshaw bought the chest for Mr Granger for $12,000. Mr Farquhar's evidence was:"I understood that the chest was being sold at a bargain basement price on behalf of someone who had fallen on hard times. I had the impression that the chest was a particular bargain. I thought that Mr Holliday was selling the chest to Mr Cranshaw at a very good price given the number of items that Mr Cranshaw was purchasing from him. I did not see the French commode while I was in Christchurch."[18] Mr Farquhar does not say how he gained this impression about the price, for example whether Mr Holliday told him this, whether he overheard some of Mr Holliday's discussions with Mr Cranshaw, or whether Mr Cranshaw told Mr Farquhar these things in the course of the weekend trip. [19] Mr and Mrs Farquhar, who are long time friends of Mr Granger, later became the owners of the chest. Mrs Farquhar is a real estate agent. In 1995 she sold Mr Granger's Palmerston North house. Mr Farquhar says that at this time Mrs Farquhar bought the chest from Mr Granger for $12,000. Mr Farquhar's evidence was that he thought this was a very reasonable offer on Mr Granger's part "as I knew that Mr Cranshaw had been told that the piece was worth considerably more than this". Again he does not say how he knew this. Mr Holliday's evidence was that Mr Farquhar did not contact him about the chest and he had no discussion with him about it. Mr Farquhar does not say otherwise. [20] Mr Granger's evidence was that he sold the chest to Mr and Mrs Farquhar in exchange for Mrs Farquhar's commission entitlement which was "in the order of $17,000". In cross-examination he said this was a mistake and the commission was $12,000 and not $17,000. Consistent with this, in cross-examination a passage said to be from a statement from Mrs Farquhar was put to Mr Granger. That was that Mr Granger would sell it for $12,000 which is what he had paid for it. (Although there is that reference to Mrs Farquhar's statement, her statement is not included in the bundle produced to me and the notes of the evidence at the District Court trial do not include any evidence from her.) Mr Granger said he gave the chest instead of cash "on the basis that it was a 19 th century antique bombé chest which was very valuable".[21] According to Mr Farquhar's evidence, soon after this a Mr Davies, who is an antique dealer, told Mr and Mrs Farquhar "on the spot without hesitation that it was a modern reproduction and not a genuine antique". Mr Farquhar then wrote to Mr Holliday requesting that Mr Holliday take the chest back and refund to Mr Granger the $12,000 that he had paid for it so that he could in turn refund the money to Mr Farquhar. Subsequent communications between Mr Farquhar and Mr Holliday ensued but the matter was not resolved. Mr Farquhar's evidence was that "[i]n April 1998, we realised that if we did not commence legal action soon, Mr Granger would not be able to recover any money that we recovered from him". Following a final attempt to resolve the matter "[w]e then instructed our solicitor to issue the present proceedings". [22] The reference to the Farquhars recovering money from Mr Granger concerns a claim they made against him in relation to the chest. The evidence before me about that claim is limited. The bundle of documents included an Admission of Claim. It is apparent from the heading of that document and the present claim by Mr Granger against Hollidays that this proceeding started as a claim by Mr and Mrs Farquhar as plaintiffs, Mr Granger as defendant, Hollidays as first third party and Mr Holliday as second third party. (I do not have the statement of claim by the Farquhars against Mr Granger although this would have been before the District Court.) [23] In the Admission of Claim Mr Granger admits Mr and Mrs Farquhar's claim for $45,000. The $45,000 is said to be the difference between the present value of the chest had it been what it was represented to be (said to be $50,000) and the present value of the chest (said to be $5,000). Mr Farquhar has signed the admission stating "the plaintiff confirms that it accepts this admission of claim and does not pursue the balance of the amount claimed". I do not have details of the balance amount that was claimed or the basis for it. [24] Mr Granger's evidence of this claim is as follows:Mr and Mrs Farquhar are now very understandably upset that the item is worth less than $5,000. They are entitled as I am, to the benefit of their bargain and I therefore accepted responsibility (as I felt I was morally obliged to), for the difference between the actual value of the item and itsvalue had it been as represented in the sum of $42,000. This difference in value is based on the professional advice from antique experts. I now seek to recover that sum from W Holliday & Sons Limited, which was the source of the misleading and incorrect description of the chest.[25] The difference between the admission of $45,000 and the $42,000 referred to by Mr Granger is not explained. In cross-examination Mr Granger said the $42,000 was the "thereabouts" equivalent of £8 - £10,000. He also said that he was not yet paid the $42,000 (or $45,000 or any sum) to Mr and Mrs Farquhar because he has not yet been asked to pay it. No further explanation as to the legal basis of the claim made by Mr and Mrs Farquhar against Mr Granger is given. (Mr Reardon was unable to elaborate on this or the basis for Mr Granger's claim for $42,000 confining his submissions to the errors relied on in the appeal).The expert evidence[26] Expert evidence as to the age and value of the chest was before the Court from a number of witnesses but of them only Mr Holliday gave his evidence in person before the District Court Judge. The evidence was provided as follows: a) Mr Granger instructed Mr Davies to give evidence. Mr Davies' evidence was taken before the Registrar in advance of the trial. This was because Mr Davies was shifting to France, and would be unavailable for trial. At this time, Hollidays had instructed Mr Langham as counsel. Mr Langham cross-examined Mr Davies. (At the trial Hollidays did not have legal representation.) b) There was also expert evidence from a court appointed expert. This was a Mr Melville. Mr Melville was asked a series of written questions (mainly compiled by Mr Holliday, although Mr Granger had the opportunity to ask any other questions). Mr Melville answered those questions in a letter addressed to the Registrar of the High Court at Palmerston North. Mr Melville was not required by either party to attend the hearing for cross-examination.c) Mr Holliday intended to call Mr Grigg to give expert evidence. Mr Grigg prepared an unsigned statement of evidence that was included in the bundle of documents provided to the Court. In the event, Mr Grigg was not available to attend the trial and so Mr Grigg was not available to confirm on oath his statement nor was he available for cross-examination. d) Mr Holliday also prepared a written statement. At the hearing he was invited by the Judge to elaborate on his evidence which he did. He was cross-examined by Mr Granger's lawyer (who at that time was Mr Maassen). [27] The expert evidence as to age and value before the Court in summary was as follows:Witness Mode of evidence Age ValueDavies Called by Granger in advance of trial and XXM before Registrar. Manufactured in the last 50 years, probably after 1950. NZ $4,000–$6,000 (£10,000 – or the equivalent of NZ $48,000 - $50,000 with dealer's commission and shipping and other charges had it been manufactured in the 1800s)Melville Court appointed expert – written questions and answers. Manufactured between 1925 to 1950. NZ$12,000 (NZ $15,000 had it been made between 1890 and 1910)Grigg Briefed by Hollidays – unsigned statement included in bundle. Manufactured before 1910 (and more likely 1800s). £12,000 (based on manufacture date of 1870 – 1910)Holliday Gave evidence at trial – invited by Judge to comment beyond matters in brief. Manufactured before 1910 (and more likely late 1800s) $12,000/£4,000 (based on manufacture date of 1870 – 1910)[28] The experts to a varying degree of detail gave evidence as to the reasons for their views. Mr Grigg's evidence (as set out in the unsigned statement) was the mostlimited. He said that replica chests made later in the 20th century were made "in an entirely different way and using very different materials". The other experts assessed the chest by considering its general condition (wear and tear), the patina (the sheen on the surface), the decorative or ornamental metal work, the internal construction and use of plywood, the use of nails and the wood stain. [29] In addition to the age and value of the chest Mr Holliday commented on the meaning of an antique. His evidence was that people have different ideas about what qualifies as an antique. He referred to the Oxford English dictionary which defines an antique as being "something made in a prior period" without stating how old it must be. He also said that New Zealand has signed a trading agreement with the United Kingdom that anything over 100 years of age can come into New Zealand without duty as an antique, although in some other countries anything over 50 years of age is considered to be an antique. Mr Davies' evidence was that most experts would class a "genuine antique" as an item of approximately 100 years of age. [30] Mr Holliday also discussed the difference between a 19th century Louis XV style chest and the original Louis XV chest from the 18th century. The latter is the original and is worth considerably more than chests made in the same style in the 19 th century. Mr Holliday said that he would not have referred to the chest as a "genuine antique" because the genuine chest is from the 18 th century. Mr Grigg's statement also covered the difference in value between the 18 th century original and the later productions although in less detail than Mr Holliday. Mr Davies agreed that the chests produced in the 1700s were worth considerably more than those made in the 1800s.The District Court's decision[31] The Judge considered his task was to determine whether Mr Granger had established whether the chest was over 100 years old or of later construction. He said that the case stood or fell on the expert evidence. He assessed that evidence to see whether Mr Granger had proved that the chest "was unlikely to be an antique worth the $12,000 he paid for it".[32] The Judge noted that Mr Holliday did not represent the chest as being the genuine Louis XV commode from the 18 th century. He accepted that such pieces sell for very high prices (eg one example sold for £210,000) and that the style of the original chest was reproduced by craftsmen over the years. The Judge commented that any chest imitating the original Louis XV chest was a reproduction, but it might still be an antique if it were over 100 years old. [33] The Judge reviewed what each of Mr Davies, Mr Melville and Mr Holliday had to say about the characteristics of the chest in support of their respective views as to age. He considered it relevant that in November 1985 when Hollidays had imported the chest from the United Kingdom, the British Antique Dealers Association certified the chest as being an antique. For import purposes there is no duty on items over 100 years of age. [34] The Judge noted that Mr Holliday challenged the expertise (but not the independence or impartiality of Mr Davies and Mr Melville). He noted that Mr Holliday was "far from impartial or disinterested" and that although this did not mean his evidence was to be disregarded, it did need to be "very closely scrutinised indeed". The Judge set out Mr Holliday's extensive experience and expertise and said (at paras (31) and (32)):"He has an extensive research library – to his knowledge more extensive than any public or private library. He keeps abreast of modern research by reading trade newspapers. My impression, from his appearance before me, is that Mr Holliday has an impressively deep well of knowledge of antique furniture amassed over his life-time. Even on peripheral or historic issues, he was thoroughly informed and very knowledgeable. He testified in a competent, confident, forthright and professional manner. His opinions appeared to be based on solid facts and objective evidence, not only on theory. I say this despite his obvious self interest in the proceedings, and accept what he says.[35] He referred to the cross-examination of Mr Holliday to the effect that the chest may have been made more recently to look like a 19th century piece. He considered that Mr Holliday's answer made sense. That answer was that no one would bother to reproduce a style of furniture that was made in large quantities in the 19 th century and which was of average value. Someone faking an antique would be better to fake the much more valuable 18th century piece.[36] In relation to value the Judge refers to Mr Melville's agreement that the retail price of $12,000 was appropriate. In relation to Mr Grigg he said this (at para (36)):"Mr Andrew Grigg of Dunbar Sloane & Co, in a short brief, confirms Mr Holliday's opinion that bombe chests like the Granger commode were not made after about 1900, and at the most, 1910. He fixes the value of late 19th century chests of this type not at $12,000 but £12,000, that is, nearly three times the actual sale price. He was not available for cross-examination on this price, and Mr Holliday suggests that may be a typing error. If it is, then he also places the value of 19 th century commodes of this type at about $12,000, the actual sale price. He does not actually value the Granger commode. Of significance Mr Grigg adds: "Replica chests were made later in the 20 th century but these were made in an entirely different way and using very different materials from the bombé chest the subject of this claim."[37] The Judge considered that Mr Holliday effectively countered all the points raised by the other experts. He concluded, at (38):"On balance, I am not satisfied by Mr Granger that there was a misrepresentation as to the nature of his commode. It is more likely than not that Mrs Farquhar now owns an antique commode of the late 19 th century".The appeal grounds[38] For Mr Granger it is submitted that the Judge's decision was irrational and unfair. This was said to be because it was not supported by the evidence, the Judge failed to apply the rules of evidence and procedure and the Judge made no finding on an important aspect of the case. The points raised on appeal can be divided into a number of issues which I deal with in turn.Mr Holliday not independent[39] Mr Reardon submits that the Judge was wrong to rely on the evidence of Mr Holliday in part because Mr Holliday was not independent. For Mr Granger, reliance was placed on an extract from R on the Application of Factortame Limited v Secretary of State for Transport (No. 2) [2002] 4 All ER 97. In that extract the English Court of Appeal commented on experts who were paid under contingency fee arrangements. The Court said that because of the threat to objectivity that thisarrangement posed it would be a rare case where the Court would consent to such an arrangement. [40] This point does not satisfy me that the District Court's decision was irrational or unfair. Despite the English Court's concern about experts who are subject to contingency arrangements there is no rule of evidence that prohibits a Court from relying on evidence (expert or otherwise) from a person who has financial interest in the outcome. That interest will be a relevant consideration in the Court's assessment of the evidence, but it does not make the evidence irrelevant and inadmissible. Here, the District Court Judge reminded himself that because Mr Holliday was not independent his evidence was to be very closely scrutinised. He nevertheless considered Mr Holliday had an "impressively deep well of knowledge of antique furniture amassed over his life-time". The Judge was entitled to make this finding and to accept Mr Holliday's evidence despite Mr Holliday's self interest.Mr Holliday had not recently inspected the chest[41] Mr Reardon submits that the District Court Judge's preference for Mr Holliday's evidence failed to take into account that he had not seen the chest for 14 years whereas the independent experts had inspected the chest more recently. Mr Holliday was, however, familiar with the chest – he had imported it in 1985, he had sold it to the trust, and in 1992 the chest had been returned to him for sale on behalf of the trust. This point does not satisfy me that the District Court Judge's decision was irrational.The two independent experts agreed[42] Mr Reardon submits that the Judge was wrong to accept Mr Holliday's evidence when the two independent experts (Mr Davies and Mr Melville) agreed that Mr Holliday had misrepresented the chest as being 19 th century. Mr Reardon says that the case for Mr Granger was approached on the basis that if the age of the item was in contention the Court had no option but to accept the unchallenged evidence of Mr Melville and Mr Davies.[43] Mr Davies and Mr Melville gave different evidence. Mr Granger's counsel seeks to explain the different in their view as to age by stating that they both claim the chest was a modern reproduction. That much is correct. However, one thought the chest was made between 1925 and 1950 and the other after 1950. Further Mr Davies considered that the meaning of a modern reproduction was something that was made after the second world war. [44] They also disagreed as to the value of the chest. Mr Melville considered it was worth $12,000 but would have been worth $15,000 if of the late 19 th century. Mr Davies disagreed with both of these values. Mr Reardon submitted that Mr Davies' value of $6,000 and Mr Melville's $12,000 were "possibly not so far apart" as Mr Davies referred to what Mr Granger would receive if the chest were sold at auction whereas Mr Melville referred to the retail antique shop ticket. I disagree that this meant their evidence was similar on value. Mr Melville's value was put to Mr Davies and he specifically rejected it describing it as "extremely excessive". He further said that the chest could have been bought for £500 in England enabling a New Zealand dealer to sell it somewhere in the region of NZ $4,000 – $5,000. [45] It was therefore not a case where the two independent experts were in agreement and disagreed with Mr Holliday. All three experts disagreed with each other as to age, and Mr Melville and Mr Holliday agreed as to the actual value of the chest (despite disagreeing on the age of the chest). Even if the two independent experts had been in complete agreement that would be but one factor in favour of accepting that evidence. The Judge would nevertheless have been able to prefer the evidence of Mr Holliday if he formed the view (as he did) that Mr Holliday's experience and expertise was impressive and his evidence the more compelling.No notice of Mr Holliday's evidence[46] Mr Reardon submits that the invariable practice is that evidence is exchanged in advance of trial so that the areas in contention are able to be assessed. Mr Reardon submits that unfairness arose because the evidence which the DistrictCourt accepted came from Mr Holliday's viva voce evidence at the trial and not from the evidence in Mr Holliday's written statement which had been provided to Mr Granger in advance of the trial. [47] Mr Davies' evidence had covered the age and value of the chest as well as the range of characteristics of the chest on which he based his views. Mr Melville's evidence had also covered the age and value of the chest and the reason for his views. The scope of Mr Holliday's evidence as to the age and value of the chest in the pre-exchanged statements was limited. Although it covered his view of the age and value it did not specifically respond to the evidence of Mr Davies or Mr Melville in any detailed way. The additional evidence from Mr Holliday was given at the Judge's invitation to respond to each of the matters covered by Mr Davies and Mr Melville. [48] I consider that it was not unfair for the Judge to admit the evidence and, being satisfied as to Mr Holliday's expertise and applying caution because of Mr Holliday's self-interest, be persuaded by it. If Mr Granger's counsel considered Mr Granger was prejudiced by what occurred he needed to object to it then and not now on this appeal. [49] Mr Reardon advised that his understanding was that Mr Maassen did object. Mr Holliday does not agree with this. There is no evidence before me that Mr Maassen did object. If he did object, it is not recorded in the notes of evidence nor in the Judge's decision. Mr Maassen has not filed an affidavit asserting that he did object. The records shows that Mr Maassen cross-examined Mr Holliday on matters that he covered in his evidence at the invitation of the Judge. [50] Further I do not agree with the grounds of prejudice that have now been raised. One ground of prejudice was that the two independent experts did not give their evidence in person. It is said that this is because their evidence was not challenged. [51] This is not entirely correct. Mr Melville was the Court appointed expert and could have been required by either party to attend the trial for cross-examination.Mr Maassen was not intending to invite the Court to accept Mr Melville's evidence as to value. Yet Mr Melville was not called by Mr Maassen for cross-examination. [52] Mr Davies (Mr Granger's expert) was overseas at the time of the trial. His evidence was taken in advance of the trial and was subject to cross-examination. It was clear from Mr Holliday's written statement that he maintained the chest was 19 thcentury. Mr Davies' evidence differed from both Mr Holliday and Mr Melville in certain respects. Mr Granger could not in these circumstances be assured that Mr Davies evidence would be accepted as to age or value. It was open to Mr Maassen to seen an adjournment to obtain further instructions and/or evidence from Mr Davies or possibly a new expert if Mr Davies was unavailable. It is not established that he sought this and it is now too late to claim that he was prejudiced by what occurred. [53] The other specific ground of prejudice raised was that Mr Holliday referred to documents in his viva voce evidence that had not been discovered. This was disputed by Mr Holliday. He points out that his written statement had referred to Millers Antique Price Guides, Sotheby's London Catalogues and Christopher Payne's book "Price Guide to 19th Century European Furniture" which he annexed as exhibits. These were the documents Mr Holliday referred to in his viva voceevidence. This submission is not made out and in light of Mr Holliday's response to it Mr Reardon does not pursue it.No cross-examination of experts[54] The next submission follows on from the last. It is submitted that the matters covered by Mr Holliday in his viva voce evidence were not put to Mr Melville. It is submitted that in the absence of cross-examination, the Court appointed expert's evidence is accepted. For this submission Mr Reardon relies on the rule in Browne v Dunn [1893] 6 R 67 as applied in New Zealand by the Court of Appeal in Gutierrz v R [1997] 1 NZLR 192. [55] The rule in Browne v Dunn is that, if the Court is going to be asked to disbelieve a witness, that witness should be cross-examined on that matter.(Lord Hershell at pp 70-71 and Lord Halsbury at 76-77 and as stated in r 441K of the High Court Rules). The rule in its strict sense is about credibility rather than reliability. Its rationale is one of fairness to the witness whose credibility is being impeached. That said, the rule has been applied beyond situations where a party seeks to submit that a witness should be disbelieved. [56] Mr Reardon referred me to Freckelton & Selby, Expert Evidence Law, Practice, Procedure and Advocacy (Lawbook Co. 2005, 3rd Ed) at pp 908-909 which says this:Cross-examination is the "accountability" mechanism within our adversarial litigation system. One party advances facts and, through its experts, opinion which will assist the trier of fact to understand those facts. The opposing party can test those opinions, both as to content and the status of the expert, through cross-examination. This is regarded as a rule of fairness and its breach has drastic consequences. Should expert witness A for the plaintiff assert proposition X and the defendant's expert witness B opine (in his or her written report or when giving spoken evidence) that proposition X is inapplicable, and further that only proposition Y can apply, the rule in Browne v Dunn (1863) 6 R 67 (HL) requires that counsel for the defendant put to witness A during cross- examination questions that relate to the inapplicability of proposition X and the appropriateness of proposition Y. Should expert witness A not be cross- examined about the alleged error of applying proposition X, and in the course of the defence's case expert witness B claims that proposition X does not apply, the judge or magistrate is entitled to point out that the rule has been broken and that expert witness A's evidence will be preferred. All that counsel for the defendant can do at that stage is to ask for leave to recall expert witness A for further cross-examination, a request which at the least is highly embarrassing and at the worst will be refused. Likewise, if counsel for the defendant remembers to raise with expert witness A the inapplicability of proposition X but neglects to mention proposition Y to witness A, the plaintiff is entitled to seek leave to reopen the case to deal with this "surprise". It is common for parties to seek leave to have their experts sit in court to hear the evidence of the opposing experts and, on occasion, the evidence of lay witnesses: see above, p 886; see also Munday (1981, p 688). Combining this practice in civil matters with the requirement of pre-hearing exchange of expert reports entails that the courts can be uncompromising in applying rules such as the rule in Browne v Dunn – after all, everyone can to a significant degree be on notice of what the other side's experts will say.[57] I agree that accepted practice is that experts can expect that contrary propositions of opposing experts will be put to them. I also agree that where this does not occur the Judge may prefer the evidence of expert A on the basis that expertB's views were not tested through expert A and/or that the party who called expert A may seek to recall expert A. But there is no rule that requires that one or other of these be the consequence of a failure to put matters of significance to the opposing expert. A further possible consequence is that the Judge takes into account in his or her assessment of the evidence that aspects were not put to the opposing expert for comment. What is the appropriate consequence will depend on what is just in the circumstances. [58] This is the position submitted (I consider correctly) by Cross on Evidence (looseleafed) para 9.58 (discussing the position before the commencement of the Evidence Act 2006) where it is said:Counsel has a duty to "put the case" of his or her client to the witnesses called by opposing counsel. Whenever it is proposed to ask the tribunal of fact to disbelieve the evidence-in-chief of the witness presently in the box, that contradictory material, or at least the essence of it, must normally be put to the witness so that he or she may have an opportunity of explaining the contradiction. Failure to do so may be held to imply acceptance of the evidence-in-chief. To comply with the rule counsel must put to each of the opponent's witnesses, in turn, so much of counsel's own case as concerns that particular witness, or in which that witness has had any share. But the particular circumstances of a trial sometimes justify a relaxation of the rule. The respects in which his or her evidence will not be accepted must be indicated to the witness. The rule is inapplicable where "evidence is given which differs only to extent and degree and does not amount to a head-on conflict". Whether there is a discrepancy between the cross-examination and the evidence of a witness called by the cross-examining party is for the jury where the discrepancy is relied on as affecting credibility. The rule is designed to ensure fairness. A prosecuting counsel who proposes to attack the credibility of defence witnesses including the defendant, must cross-examine in a way that makes it plain that the relevant evidence is being challenged. Also, the witness must be given a fair opportunity to answer the challenge. The consequences of non-compliance are not, however, very clear on the authorities. It is submitted that the Judge may take any course which is just in the circumstances. Normally the best remedy is to allow the party who called the witness to recall him or her in rebuttal of the other party's contradictory material, so that matters not put to the witness may now be put to him or her. "An offer to tender a witness for further cross-examination will in many cases suffice to meet, or blunt a complaint of surprise or prejudice resulting from a failure to put a matter in earlier cross- examination."[59] In passing, I note that any uncertainty as to the requirement to "put the case" and the consequences of not doing so is now clarified under s 92 of the Evidence Act 2006 (not in force at the time of this trial). The requirement is to cross-examine a witness on significant matters that are relevant and in issue and that contradict the evidence of the witness if the witness could reasonably be expected to be in a position to give relevant evidence on those matters. If this is not complied with the Judge has a discretion as to whether to grant permission for the witness to be recalled, admit the contradictory evidence taking into account that its weight might be affected because a witness who might have contradicted it was not questioned about it, exclude the contradictory evidence or make any other order that the Judge considers just. [60] In this case, Mr Holliday did not put his views to Mr Melville. Mr Holliday says he had already asked Mr Melville the questions he wanted to ask him. Mr Holliday says that Mr Melville agreed with him about value. He also says that Mr Melville accepted that in June 1992 when the chest was sold it would have been difficult to assess the age of the chest with an accuracy within a 20 year period. I disagree with Mr Holliday that this means that Mr Melville agreed with Mr Holliday as to age. Mr Melville's assessment of 1925 – 1950 already builds into it a (slightly more than) 20 year degree of uncertainty. [61] However the just consequence of Mr Holliday's failure to cross-examine Mr Melville was not that the Court should then have accepted all of Mr Melville's evidence. Mr Melville was a court appointed expert. Mr Reardon submits that the rule in Browne v Dunn applies to Court appointed experts but cited no authority for that. The fairness rationale for the rule has less force where the expert is a court appointed one. The parties have put forward their own experts on whom they rely. The court appointed expert reports to the Court and is there to assist the Court. It is for the Court to decide what it makes of that report. [62] This is made plain by r 344(4) of the District Court Rules (and the identical r 326(4) of High Court Rules). That rule provides that if a party does not accept any part of the Court expert's report it "shall be treated as information furnished to theCourt and shall be given such weight as the Court thinks fit". McGechan on Procedure (para HR 326.04) comments in relation to this as follows:Where any part of the report is not accepted by all the parties, it still has the status of "information" before the Court. Although the rule studiously avoids describing the report as "evidence", the Court is nevertheless required to give whatever weight it considers appropriate to the rejected portions. In deciding what weight is to be given to the report, regard may be paid to, among other things, its unsworn nature, any hearsay evidence included or relied on, whether the expert has been cross-examined, and whether there has been evidence in rebuttal. It must also be borne in mind that the entire procedure is largely based on the agreement of the parties; where the rejection of parts of the report appears to be a reasonable response, this factor should also be taken into account.[63] In addition, Mr Davies (Mr Granger's expert) had the opportunity to comment on Mr Melville's view. When Mr Davies was called Mr Maassen put to him Mr Melville's views as to its age, its actual value and the value it would have had if manufactured between 1890 and 1910. Mr Davies disagreed with Mr Melville's views on each of these matters. He gave his explanations for why he disagreed. He further commented that to be a "genuine antique" the item would need to be approximately 100 years of age. He also said that the term "modern reproduction" referred to an item made after the second world war. [64] While Mr Davies did not have Mr Holliday's comments on a number of things, it is clear from my review of the evidence that Mr Davies had a full opportunity to comment on these matters from his own perspective. Mr Davies was cross-examined as to an item he referred to in support of his view that a chest from the 19 th century would sell for £10,000. He accepted that the item might have been manufactured in the early part of the 19 th century and if so would have a higher value than if manufactured in the late 19th century. He was cross-examined on Mr Holliday's proposed reliance on various price guides and explained his reasons for not relying on them. He was cross-examined on the purchase price paid by the trust for the chest and gave his view as to why he considered that price to be excessive. The British antique dealer's association certificate in 1985 that it was an antique for the purposes of export to New Zealand was put to him. He was asked about Mr Holliday's reputation as an antique dealer. He was asked about whether he was aware of a debate about items manufactured after 1860 and said he was unawareof such a debate. He was asked to comment on where manufacturing of these kinds of chests took place. He was asked about patina, ormolu, the interior construction material, nails and the stain. [65] Mr Reardon says that in fairness Mr Granger (and his expert) should have had advance notice of the passages in the publications that Mr Holliday intended to rely on. However, Mr Granger did have notice of the publications that Mr Holliday intended to rely on. The material was not extensive. Mr Granger had the opportunity to provide those to Mr Davies and to have him comment on them when he gave his evidence. Mr Holliday says that it was obvious Mr Davies was not an expert since (amongst other things) he did not even know of the leading text on 19 thcentury furniture or if he did he did not refer to it. I do not think it was necessary to put to Mr Davies all the reasons and/or references in publications that Mr Holliday relied on when the submission Mr Holliday was relying on was that Mr Davies was not an expert. [66] It was also clear from the cross-examination that Mr Davies' evidence was potentially in issue. Had Mr Granger wished to call a further expert who could attend the hearing he was free to do so. He was also free to seek an adjournment if he felt prejudiced during the course of the trial. [67] I therefore conclude that although the course adopted was unusual it was not unfair such as to require a rehearing.Reliance on unsworn statement[68] Mr Reardon submits that the Judge was wrong to place reliance on Mr Grigg's unsworn statement. It is said that unless a person confirms their written statement on oath and are made available for cross-examination the statement does not qualify as evidence unless it is accepted by the other party. Mr Granger did not accept Mr Grigg's statement. [69] Mr Reardon initially submitted that the statement was not included in the bundle of documents but rather was before the Court only as proposed evidence forHollidays and on the understanding that Mr Grigg would be giving evidence. Mr Holliday says that he told Mr Maassen (Mr Granger's then counsel) that Mr Grigg was not going to be attending the hearing. [70] In the Case on Appeal produced to me on this appeal Mr Grigg's statement is included as part of the "Bundle of Documents" presented at the District Court hearing. I therefore proceed on the basis that it was included in the bundle of documents. The basis on which documents were included in the bundle was not explained to me. I do not therefore know whether there was a basis agreed for the bundle of documents and if so what that basis was. [71] There is nothing in the record to indicate that Mr Maassen objected to the statement being before the Court once it became apparent that Mr Grigg would not be called. Further, whatever was known, discussed and/or agreed, the record shows that Mr Maassen relied on the statement in cross-examining Mr Holliday. That cross-examination was to the effect that Mr Grigg, an expert that Mr Holliday had briefed, considered the chest would have been worth £12,000 if had been from the 19 th century. Mr Maassen also referred to this being consistent with Mr Davies' evidence that if the chest had been from the 19th century it would cost at auction around £10,000. This cross-examination was directed at putting to Mr Holliday that he did represent that the chest would sell for £8,000 - £10,000 in England. [72] I agree that normally an unsigned written statement of a person who is not available for cross-examination would not be admissible absent consent. I accept that Mr Granger did not accept the contents of at least aspects of the statement. That is a different question to whether Mr Granger allowed the statement to be admitted into evidence by consent. I consider that on this appeal Mr Granger has failed to establish that the statement was not admitted by consent. [73] Further, although the Judge referred to Mr Grigg's statement under the heading "Other relevant matters", it was not the principal basis on which the Judge made his decision. The Judge's conclusion on the evidence is found under the heading "Decision". There it is clear that the Judge found that Mr Granger had not proved his case because "Mr Holliday raised arguments effectively countering allpoints raised by the other experts" and "I found him to be a credible and compelling witness".No finding on value[74] Mr Reardon submits that the Judge failed to address a central question in the case, namely whether Mr Holliday misrepresented the value of the chest. This was said to be both relevant to the credibility of Mr Holliday and in the claim made by Mr Granger. [75] Mr Cranshaw's evidence was that Mr Granger had said the item would sell in the United Kingdom for between £8 – £10,000. His evidence was supported by a note he made on the back of his chequebook. Mr Holliday's evidence was that he did not know where the £8 – £10,000 came from and he did not say it. (This denial came in his viva voce evidence and not in his written statement filed in advance of the hearing.) In cross-examination he accepted that a 19th century chest of this kind could have a value of up to £10,000 but only if it was made in Paris. This was relied on by Mr Granger as indicating that the representation would not have been an outlandish one and so could have been made, and also as acceptance by Mr Holliday that this chest did not have this value. [76] It is correct that the Judge did not make any finding as to whether Mr Holliday said this. Had the Judge found that Mr Holliday represented the chest has having a value of £8 – 10,000 when it was not true, I agree that this would have been relevant to credibility and the Judge could have taken that into account. But there was nothing about the evidence that required the Judge to find this. There was a contemporaneous note written on the back of the chequebook but that did not necessitate a finding that the note was written because that was what Mr Holliday had said. Mr Holliday denied it and cross-examined Mr Cranshaw to this effect. The Judge found Mr Holliday to be a credible and compelling witness. The failure to make a specific credibility finding in relation to this point does not give rise to irrationality or unfairness so as to require a new trial.[77] As to the relevance of the alleged misrepresentation, it was relied on in relation to the second cause of action. It was pleaded that this representation reinforced the representations that the chest was at least 100 years old and that it had a greater value than a modern reproduction. The damages claim was for the difference between the actual value of the chest had the representations been true and the actual value. [78] The Judge found on the evidence that the chest was more likely than not an antique chest made in the late 19th century. The Judge therefore did not need to assess the difference in value between the actual value of the chest as a modern reproduction and the represented value, because it was not established that it was a modern reproduction. The chest had whatever value a chest of the late 19th century has: $12,000 (Mr Holliday), $12,000 – $15,000 (Mr Melville) or £10,000 (Mr Davies). [79] Even if Mr Granger claimed that he was entitled to the difference in value between the true value and a represented value of £8 – 10,000 regardless of age, it is not apparent from the evidence that it was established that the misrepresentation was passed onto Mr Granger and relied on him, nor that he suffered any loss even if the misrepresentation was made. The alleged representation that the chest had a value of£8-10,000 was made to Mr Cranshaw. Mr Cranshaw did not specifically say he passed this on to Mr Granger although Mr Granger says he did. It seems that Mr Cranshaw was instructed to proceed to purchase the chest on the basis that he was getting a real bargain. He did get a real bargain if Mr Davies' view of value of a 19thcentury chest is accepted. He also did well if Mr Melville's evidence of the value of a late 19th century chest of this kind is accepted. By reference to the purchase price paid by the Trust he also did well. [80] In the event, Mr Granger was content to exchange the chest for a $12,000 fee he owed and so did not look to benefit from the bargain he thought he had secured. (Further, Mr Farquhar was initially content to return the chest to Hollidays in return for $12,000.) I can therefore see no prejudice to Mr Granger in the Judge's failure to specifically address the value of the chest even if he was in a position to do so on the material before him.Overall[81] Individually the issues raised on appeal are not made out. Considered as a whole I consider that they do not give rise to any irrationality or unfairness such as to require a re-trial or rehearing of aspects of the evidence.Result[82] The appeal is dismissed. Hollidays are entitled to their disbursements on this appeal. Mallon JSolicitors:J Reardon, Cooper Rapley, PO Box 1945, Palmerston North, ph: 06 358 6123, email: jreardon@crlaw.co.nz