EVIDENCE – whether respondent had made admission as to appellants’ right to immediate possession – probative value of admission made– whether inference should be drawn from respondent’s failure to give evidence at trial

Brendas v Genter [2018] NSWCA 8

  1. Whilst the evidence relied upon by the appellants was admissible as an admission, as personal knowledge or belief in the fact admitted is not required, it does not follow that it was probative of the relevant fact in issue, being whether the appellants had an immediate right to possession of any of the Caterpillar machines.
  2. In Lustre Hosiery Ltd v York (1935) 54 CLR 134; [1935] HCA 71 the High Court per Rich, Dixon, Evatt and McTiernan JJ held that (at 138-139):

“No doubt an admission made by a party as to the correctness of a fact is admissible in evidence notwithstanding that the party has no direct knowledge of the fact and must rely for his belief upon the statements of others, or upon inferences from circumstances which he knows, or which have been reported to him. But such an admission may indicate a state of mind varying from a firm belief based upon a thorough investigation of the existence or occurrence of the fact down to a wavering preference for one of two or more possible hypotheses none of which have been tested or determined. It is apparent that the admissibility of the evidence must be distinguished from its sufficiency to establish or support an affirmative conclusion in favour of the party who tenders it, when the burden of proof lies upon that party. It does not follow that, because such evidence is admissible, it is enough to prove the issue”.

  1. The High Court went on to conclude, following a discussion of earlier authority, that (at 143-144):

“This course of authority seems consistent with the view that words or conduct amount to an admission receivable in evidence against the party if they disclose an intention to affirm or acknowledge the existence of a fact whatever be the party’s source of information or belief. In determining whether he intends to affirm or acknowledge a state of facts the party’s knowledge or source of information may be material. For if he states that another person has told him of it, and it appears that he has additional sources of information to the like effect, it may be right to understand him as implying a belief in what he repeats. Or, again, a person who fails to contradict a statement concerning matters within his own knowledge may be understood as acquiescing in the statement if the circumstances are such as to make it unlikely that he would allow an erroneous statement to pass unchallenged. But, although the meaning of his words or conduct may depend upon the state of his knowledge, once that meaning appears and an intention is disclosed to assert or acknowledge the state of facts, its admissibility in evidence as an admission is independent of the party’s actual knowledge of the true facts. When admitted in evidence, however, its probative force must be determined by reference to the circumstances in which it is made and may depend altogether upon the party’s source of knowledge”. [italics added]

  1. The position remains the same under the Evidence Act 1995 (NSW). The Australian Law Reform Commission in its report Evidence (Interim), Report No 26 (1985) vol 1 at 424 [755],explained:

“Under existing law, admissions which are not based on personal knowledge are admissible if there is evidence of belief in the fact admitted. It is proposed to retain this approach. While the assumption that admissions are generally trustworthy is not so persuasive where the admission is not based on personal knowledge, such admissions will, when tendered in evidence, usually concern some matter of substantial importance to the declarant upon which he has informed himself, so that they possess greater reliability than hearsay in general. Further, if admissions were only admissible when based on first-hand observation, enormous evidentiary difficulties would follow since much of the ‘knowledge’ which a person accepts as factual might be traced to a hearsay basis. What matters is the probative value of the admission, and this will depend on a variety of factors, including the sources on which it is based. Nevertheless, its probative value is likely to be high, where he or she made it with the belief that it was true and with knowledge of or the opportunity to check the reliability of the informants. In these circumstances a rule of inadmissibility seems inappropriate.”

  1. The Evidence Act in “Part 3.4 Admissions” retained this approach and does not require personal knowledge as a condition of admissibility of an admission. What matters is the probative value of the admission.
  2. In all of the circumstances of this case, the subjective belief of the respondent about whether the appellants had an immediate right to possession of certain property was not probative of that fact. There was no evidence from which it could be inferred that the respondent had been told by anybody or had any independent knowledge about any of the matters necessary to establish that the appellants had an immediate right to possession of the Caterpillar machines. Indeed, the evidence was that after the conversations referred to in [9]-[10], the respondent had spoken to his solicitor who had said “…Spiros [the first appellant] can’t have the machine. He’s in liquidation. It’s not his machine” and that “I called my solicitor and he investigated and called the liquidator and said ‘It’s not Spiros’ machine and don’t give it to him. He has no authority to the machine’”: see [12]. That evidence strongly suggests that the respondent, prior to communicating with his solicitor, had no relevant knowledge of the appellants’ rights to possession of the Caterpillar machines. There was also evidence, given by Ms Majstorovic, that Kenoss was in liquidation. How that evidence was consistent with the appellants’ theory concerning their asserted rights of subrogation was not explained.
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