Background

An International Manufacturer of insulation products was dubious about a local rival’s claimed compliance with fire hazard requirements.  It commissioned its own scientific analysis, which seemed to confirm its suspicions.

The International Manufacturer arranged for its lawyers to write to the Local Manufacturer outlining their concerns and providing copies of their own test results, asking it to correct what were described as misleading and deceptive representations.  The Local Manufacturer declined, and told the International Manufacturer that it should raise any concerns it had with the relevant authorities.

The International Manufacturer then implemented a “counter-marketing” campaign – dramatically named “Project Shield and Sword” – by which it distributed the results of its analysis, including a narrated video, to market participants.

In due course the Local Manufacturer learned about Project Shield and Sword, and commenced legal action seeking injunctions to stop future distribution, and claiming compensation for damage that it said had been caused by the actual distribution.

The International Manufacturer engaged the fire safety engineer who undertook the original analysis as one of its independent technical experts.  At trial, his independence was challenged twice.  First, the Local Manufacturer said that it was wrong for his original analysis to be described as “independent” as part of the counter-marketing campaign.  Secondly, it argued that his role in the original analysis demonstrated that he was a “hired gun,” and that his evidence should not be admitted in the proceedings because it was the product of a lack of independence.

The Expert’s independence

The Expert was subject to specific cross-examination about his understanding of the Practice Note and Expert Witness Code of Conduct, and it was clear that the Court was satisfied that he had complied with those requirements, not just in relation to his evidence to Court, but critically, also in relation to the original analysis.

There was also forensic analysis of the communication between the International’s lawyers and the Expert, guided by Boland v Yates Property Corporation Pty Ltd:

“For…legal advisors to make suggestions is a quite different matter from seeking to have an expert witness give an opinion which is…not an honest opinion that he or she holds or is prepared to adopt…counsel and solicitors have a proper role to perform in advising or suggesting, not only which legal principles apply, but also that a different form of expression might appropriately or more accurately state the propositions that the expert would advance…so long as no attempt is made to invite the expert to distort or misstate facts or give other than honest opinions.”

Clearly the Expert’s response in cross-examination impressed the Court, which noted that “the opinions that he expressed…were his own and were arrived at independently of any held within [the International Manufacturer].

Conclusions

In Pirmax Pty Ltd v Kingspan Insulation Pty Ltd [2022] FCA 1340 the Federal Court held that:

• The Evidence Act did not “require untrammelled independence or impartiality (however preferable those qualities plainly are).”
• The International Manufacturer’s original engagement of the Expert did not compromise his independence, and his views were arrived at independently – even if they were later “weaponised” as part of Project Shield and Sword.
• The International Manufacturer did make the alleged representations that the product was non-compliant and could not safely be used; and it did represent that the original analysis was independent – but those representations were factually correct, and so the Local Manufacturer was unsuccessful.