Is your affidavit logically, ethically and grammatically wrong? (Part 1) The Federal Court sets out six principles for recording evidence of conversations in affidavits
On 27 April 2023, the Federal Court of Australia published an interesting judgment which may affect the way evidence of conversations is presented in affidavits in New South Wales.
Kane’s Hire Pty Ltd v Anderson Aviation Pty Ltd  FCA 381 (Kane’s Hire) concerned a contractual dispute between parties regarding the purchase of an aircraft. Relevant to both parties’ cases were multiple conversations held between Mr Kane and Mr Anderson regarding the features of the aircraft.
In his affidavit, Mr Kane gave evidence of conversations using the widely accepted practice in New South Wales of writing “in words to the following effect” and putting the conversation into direct speech.
When the presiding judge, Jackman J, asked Mr Kane whether he recalled the exact words that had been used in the conversation, or the gist of the conversation, Mr Kane responded that he was not “talking word for word” and that “it was more like the idea [of] what the conversation was about.”
Mr Anderson, on the other hand, whose solicitors were based in Victoria, gave evidence summarily, as to the nature of the conversations that were had.
Although the form of each party’s evidence of conversations did not ultimately influence Jackman J’s assessment of the witnesses’ credibility, Jackman J raised concerns about the New South Wales practice of giving evidence of conversations in direct speech in circumstances where witnesses may only recall the substance or the gist of conversations.
Evidence of conversations in the form of direct speech
Historically, in New South Wales, evidence of conversations has often been ruled inadmissible by the courts unless expressed in direct speech.
According to Jackman J in Kane’s Hire, however, the practice of putting evidence of conversations into direct speech fails to accommodate for circumstances in which a person may recall the gist of a conversation, but not the particular words that were used at the time.
Jackman J foregrounded that a witness’s primary duty is one of honesty and candour, and that to give evidence in the form of direct speech when they cannot recall the actual words spoken would be contradictory to this duty.
His Honour deemed this practice of “working up a version of a conversation in direct speech” to be “logically, ethically, and grammatically wrong”.
Six principles for recording evidence of conversations
Jackman J highlighted “the difference between verbatim memory and gist memory” and set out the following six principles which should be applied in recording evidence of conversations:
The form of evidence by a witness regarding a conversation should correspond with their actual memory;
If a witness only remembers the gist of the conversation, then indirect speech should be used;
If a witness remembers particular words, then quotation marks should be used for them while the rest of the conversation should be in indirect speech;
If a witness genuinely claims to recall the actual words, then direct speech should be used quoting the actual words spoken;
Where direct speech is used, phrases like “in words to the following effect” should not be used as preface because they blur the distinction between verbatim and gist memory; and
A witness who claims to remember actual words but is later found to have exaggerated the nature and quality of their memory, may suffer an adverse finding to their credibility.
The considerations of Jackman J in Kane’s Hire were recently mentioned in the Federal Court in the decision of Girchow Enterprises Pty Ltd v Ultimate Franchising Group Pty Ltd  FCA 420 where Thawley J made a criticism that the affidavit evidence in that case contained numerous accounts of conversations, often in direct speech and that it was “fair to say that attention was not given to the sorts of considerations recently emphasised by Jackman J in Kane’s Hire Pty Ltd v Anderson Aviation Australia Pty Ltd  FCA 381 at -”.
The courts in New South Wales on the other hand have not yet considered the Kane’s Hire decision. Historically the courts in New South Wales have preferred evidence of conversations to be expressed in direct speech.
In the Supreme Court of New South Wales decision of LMI Australasia Pty Limited v Baulderstone Hornibrook Pty Limited (2001) 53 NSWLR 31, Barrett J declined to permit the affidavit evidence in the form of indirect speech to be read but granted leave for oral evidence in direct form to be adduced from the witness. Barrett J stated:
“There is no rule of law, whether under the Evidence Act or otherwise, which makes inadmissible evidence of a conversation given in indirect speech, but there are obviously very good reasons why courts have, over the years, been astute to regard the direct speech form as the best form”.
Moving forward, it remains to be seen how the courts in New South Wales will approach this issue. That said, whether drafting evidence for use in the Federal Court or the courts of New South Wales, it would be prudent for legal practitioners to have regard to the considerations raised by Jackman J in Kane’s Hire.
From a practical perspective this may mean:
The witness explaining in the affidavit the extent to which they can recall a conversation and the extent to which their recollection has been refreshed by documents or recordings.
If the witness can remember the exact form of words, using those words in direct speech.
If the witness cannot remember the exact form of words, consider using words in indirect speech whilst taking care not to make statements of conclusion (which would be ruled inadmissible).
If you have used words in indirect speech, explaining to the judicial officer hearing the case in the NSW Courts why the evidence has been prepared in this way and seeking leave (if necessary) to rely on any evidence given in indirect speech.
If you have any questions about this article or need any assistance with a dispute please contact the authors or any of our Commercial Dispute Resolution team.