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The Importance of Demonstrating Expertise: Eckford v Six Mile Creek

What strengthens an expert opinion? In Eckford v Six Mile Creek Pty Ltd (No 2) [2019] FCA 1307, the court emphasised three aspects of expert reporting that help to demonstrate the reliability and strength of expert opinions.

Background:

The Applicant in this matter purchased a seafront property. He alleged that the Respondents (the previous owners of the property) represented that he would enjoy unobstructed scenic views of both the nearby Mount Coolum and the ocean from the property. He further alleged that the Respondents made representations that there were height restrictions on the property in front of the one he purchased. He later learned that there were in fact no height restrictions in place, meaning that the views from the property would potentially be completely impeded in the future.

The Applicant contended that the Respondents engaged in misleading or deceptive conduct and made false or misleading representations in contraventions of ss 52(1) and 53A(1)(b) of the Trade Practices Act 1974 (Cth). The Applicant also claimed damages for the tort of deceit due to a representation that other lots had been ‘sold’, when this was not the case.

Experts Engaged:  

ExpertsDirect was retained by the Applicant to provide an expert property valuer specialising in waterfront properties, with particular expertise in Queensland properties. We provided Mr John Leeson, an expert valuer with over 30 years of industry experience.

The Respondents called Ms Diane Hunt to give evidence regarding the value of the property.  Ms Hunt obtained valuation qualifications in the United Kingdom in 1979 and 1981, and was a registered valuer in both Queensland and New South Wales.

Discussion of Expert Evidence

Mr Leeson and Ms Hunt, in addition to their expert reports, gave concurrent oral evidence to the court on the above issues. Justice Rares ultimately gave more weight to Mr Leeson’s evidence. The Applicant’s expert report contained a thorough analysis of the history and physical state of the property that distinguished Mr Leeson’s expertise from that of Ms Hunt’s.

In its discussion of the relative merits of the reports, the Court identified three main points of comparison:

1) Adherence to Schedule 7 of the Uniform Civil Procedure Rule 2005 (NSW)

Schedule 7 of the UCPR requires experts to provide a statement of their education, training, and experience.

Mr Leeson annexed a detailed curriculum vitae to his report as evidence of his considerable experience in valuing real property, as well as extensive expert witness experience. In contrast, Ms Hunt’s report did not set out in any detail her professional experience, or career.

Experts should comply with the statutory rules regarding the format of expert witness reports. Such compliance is significant not only for the sake of ensuring their report is admissible, but also for the purpose of providing the court with a report that more strongly reflects the expert’s competency.

2) Engagement with the Material Facts of the Matter

Mr Leeson’s report also benefited from his close attention to the actual history of the property. Since his method of valuing the property (as a whole rather than in development stages) reflected the nature of the sale of the property (as a whole), Mr Leeson’s report carried validity. The Court described Mr Leeson as having conducted ‘careful research’. [323]

In contrast , Ms Hunt conducted neither a site inspection (instead, she viewed the property externally from the street) nor extensive research into the actual market history of the property. Her analysis of market value subsequently proceeded on erroneous assumptions about the elevation, views, and method of valuing of property, which impacted upon the Court’s perception of the (in)accuracy of her valuations. [323]

An important lesson here is that expert reports should reflect the material facts of the case as closely as possible. Here, giving accurate metrics of the location and geography of the property was one critical means of engaging properly with the matter.

3) Clear and Detailed Reasoning

When asked to justify her report opinions, Ms Hunt responded that they stemmed from her ‘own knowledge‘ [323] and experience. Without specific reasons for opining, for instance, that certain properties could provide adequate comparative market value, her report appeared to be ‘less reliable’ [325] than that of Mr Leeson’s. In her oral evidence, her claim to the accuracy of her opinions despite the absence of concrete rationalisations of her estimation process meant she appeared to the court as “more assertive than reasoned”. [317]

Justice Rares commented that Ms Hunt did not “provide any clear reasoning in her report for arriving at the values she gave other than stating, pithily, the features of the properties that she considered as evidence of comparable sales.” [317].

In contrast, Justice Rares described Mr Leeson as providing evidence that was “well researched and reasoned.” [317]. Although both experts were adequately qualified to provide reports on the matter, the more detailed reasoning and additional research methods adopted by Mr Leeson had the effect of elevating his report in the eyes of the Court. Mr Leeson’s justification of his valuation involved references to past photos used to market the property, empirical measurements and observations from his site inspection, and the National Height Datum.

The Court summarised its thoughts at [329]:

“In my opinion, Ms Hunt’s approach to valuation and her selection and evaluation of what she regarded as properties that gave a guide to the value of lot 10 was unscientific, at times prone to exaggeration and unpersuasive. I found Mr Leeson’s evidence, in contrast, to be well researched, thoughtful and reasoned and I prefer it to Ms Hunt’s.”

Takeaways:

In summary, Justice Rares found Mr Leeson’s evidence regarding the valuation of the property more persuasive than Ms Hunt’s. The Court ultimately relied on Mr Leeson’s evidence in deciding the matter. Formality, factual relevance, and careful reasoning were critical in ensuring that the Court found Mr Leeson’s report reliable and accurate.

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