There are a range of matters where expert reports are needed. Often, it can come down to the quality of the reports, which can determine whether a party succeeds or fails.
Understanding the relevant legislation and the leading case law is vital for both practitioners and court experts to ensure that a reliable expert report is prepared. If an expert does not comply with established principles, the client’s case could be lost, and, in the worst case, an adverse costs order could be made against the client. This could mean the client has to pay, not only for their own lawyers and experts’ costs, but also a significant portion of the other side’s legal and expert costs as well.
Relevant legislation
For any matters in New South Wales (‘NSW’) courts, it is important that experts comply with Schedule 7 of the Uniform Civil Procedure Rules 2005 (NSW), which is the Expert Witness Code of Conduct. In NSW, if an expert report does not comply with Schedule 7, their reports may not be admissible (See Uniform Civil Procedure Rules 2005 (NSW) r 31.23).
NSW Tribunals have their own practice and procedure which needs to be followed regarding expert witnesses – with similar effect for non-compliance. Although, instead of the expert report being inadmissible, it is more likely that an expert report that does not comply with the relevant directions will be given less weight instead of being inadmissible (See, for example, NCAT NSW Civil and Administrative Tribunal – Procedural Directions 3 – Expert Evidence).
Leading cases
There have been two leading cases in this area (Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305 and Dasreef Pty Limited v Hawchar [2011] HCA 21). The cases established the following principles:
- There must be a field of specialised knowledge relevant to the case (Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305, [85] (‘Makita’).
- The expert needs to have specialised knowledge of the specific field in which the expert is giving an expert opinion (Ibid). If this criterion is not satisfied, then this effects the admissibility of the expert report, not its weight (Dasreef Pty Limited v Hawchar [2011] HCA 21, [42]) (‘Dasreef‘).
- The expert needs to have a factual basis for making their opinion. The factual basis can either be by way of observation, assumption, or facts that are identified and proved (Makita, [64], [85]). If the expert does not do this, then this goes towards the admissibility of the expert’s report (Dasreef, [64]).
- The expert must provide a clear scientific methodology or intellectual basis for their conclusion (Makita, [85]).
- The expert’s evidence must explain the basis for their opinion based on how the expert’s specialised knowledge applies to the facts (Ibid).
- The expert cannot merely provide an unsupported assertion. The expert’s expert opinion needs to be capable of being tested (Makita, [59])
The court is not bound to accept the expert report even if it is not challenged (Makita, [87]).
What happens if the principles are not complied with?
Although these principles are generally well-known, cases can often succeed or fail depending on whether the principles were properly followed or not. A recent example is the case of In the matter of Mayne Pharma Group Limited [2025] NSWSC 1204. In that case, the main complaint was around the plaintiff being issued with a material adverse change (‘MAC’) notice and a termination notice purporting to terminate a Scheme Implementation Deed. From an evidentiary standpoint, the plaintiff’s success was influenced by the failure of the experts, relied upon by the first and second defendants, to abide by the principles discussed above. The Court pointed out that:
- One expert for the defendants was tasked with analysing the plaintiff’s financial forecasting and sales performance. However, the expert did not specify the assumptions he relied on in his report and was not able to articulate them during cross-examination (In the matter of Mayne Pharma Group Limited [2025] NSWSC 1204, [27]).
- Another expert for the defendants was asked to evaluate the commercial impact of a specific letter on gross sales, but his evidence was criticised for failing to engage with actual marketing strategies adopted by Mayne Pharma Group (‘MPG’). Instead, he attributed the hypothetical marketing strategies to MPG which were not supported by evidence. His assumptions were found to be flawed and his methodology was deemed to be unreliable (In the matter of Mayne Pharma Group Limited [2025] NSWSC 1204, [309]-[322]).
The plaintiff’s expert report was preferred, in part because their expert identified errors in the defendants’ expert’s calculations, such as not applying the correct exchange rate (In the matter of Mayne Pharma Group Limited – [2025] NSWSC 1204, [292], [296]).
Conclusion
Although the principles have been established for more than a decade, the same issues with non-compliance continue to exist. This puts clients at risk of their expert report being made inadmissible, losing their case and/or an adverse costs order being made against them.
If you brief an expert, it is imperative that you are familiar with the above principles and ensure that any expert report is compliant.
