Adequacy of reasons

The duty of a trial judge to give adequate reasons was at the heart of a recent appeal before the Full Federal Court brought by Carlisle Homes Pty Ltd.  Carlisle, who we are acting for, was sued by Barrett Property Group Pty Ltd (Porter Davis Homes) for allegedly infringing copyright in Barrett  plans such as “the Seattle”.  Barrett has sued several industry players for infringing copyright in the ‘al fresco quadrant’ component of this plan (an open plan area plus courtyard under a single roofline).  Carlisle lost at first instance and appealed the decision.

Both parties are competitors in the volume homes market.  The appeal centred on Carlisle’s submissions that the trial judge wrongly held that the Carlisle principals had conspired to give false evidence.  In making this finding, Carlisle submitted that the trial judge did not deal with testimony contrary to the finding (therefore giving inadequate reasons), and that he failed to test his conclusions against the design derivation case that Carlisle Homes had advanced at trial.  Noel Hutley SC submitted for Carlisle that, given the seriousness of the findings made by the trial judge, it was incumbent on him to evaluate fully all central evidence giving rise to this conclusion.  It was also necessary to test his findings against the apparent ‘fingerprints’ in Carlisle’s initial drawing which indicated that the design source was not a Barrett plan.  By failing to do this, Carlisle argued that there was a significant error justifying a new trial.  To do otherwise would deny Carlisle and its principals procedural fairness given the potential adverse impact these findings could have on their reputations.

The need for judgments to provide adequate reasons is increasing in profile at present.  The obvious rationale is that they must provide the “foundation for the acceptability of the decision by the parties and the public” (Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247, 249 per McHugh JA). A judgment containing adequate reasons establishes a framework for determining whether the decision has been based on material fact and not mere speculation, whether procedural fairness has been accorded, or whether the judge may have erred at law. Much of this law is emerging from the respective Court of Appeals of New South Wales and Victoria.  There are no fixed principles.  For instance, the law will not demand an express finding concerning every fact leading to or relevant to a judge’s final decision (Soulemezis v Dudley Holdings, (1987) 10 NSWLR 247 per Mahoney J at 271). However, where the evidence is crucial to the proper determination of the matter and the trial judge has failed to refer to it, this may encourage an appellate court to infer that the evidence was overlooked or not considered by the trial judge (Sun Alliance v Massoud [1989] VR 8). This might result in a finding of mistrial so that a new trial is ordered.

A review of the cases shows that there are strong comments being made about the duty of a judge to provide proper reasons.  Equally though, this needs to be balanced against the possibility that too much irrelevant detail will be included in judgments capable of muddying, rather than clarifying, the reasons for decision. The Full Federal Court, comprising Tamberlin, Sundberg and Besanko JJ has reserved its decision.

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