Documenting the Truth: How Contemporaneous Records Can Win Your Case
Contemporaneous documentation is critical when assessing the evidence given in commercial disputes. The recent decision in LL UP Pty Ltd v Kegland Distribution Pty Ltd [2024] VSC 651 in the Supreme Court of Victoria highlights this importance. The case concerned a dispute over the ownership of shares in Kegland Distribution Pty Ltd (Kegland), a company selling home brewery equipment and ingredients.
The plaintiffs, LL UP Pty Ltd (LL) and its director, Hong Rui Liu (Hong) claimed that Hong owned 50% of the shares in Kegland. However, the defendants, Kee Doery, Ari Luo, and Sam Jum Lie, argued that Hong held these shares in trust for Kee and Ari.
Both sides relied heavily on contemporaneous documentation, including emails, share certificates, minutes, accounts and a draft share sale agreement.
Key Court Findings:
The Court emphasised the importance of contemporaneous documentation, such as emails, WeChat messages and financial records, in evaluating witness credibility. These documents, are often ‘created in circumstances where parties do not expect the documents to surface in a trial’ and therefore often contain a truer account of events than oral testimony given years later.[1]
Ultimately, the judge ruled in favour of the defendants, recognising the trust’s existence and dismissing the plaintiffs' claims.
The Judge’s 13 Propositions on Contemporaneous Documentation:
The Judge outlined 13 key principles courts consider when assessing contemporaneous documentation:
Complex cases often involve incomplete or distorted evidence, yet a coherent picture can still emerge from the available pieces, even if imperfect
When challenging a witness's testimony, it is essential to dissect their account. An isolated inaccuracy does not automatically discredit the entire testimony, as errors may arise from memory lapses or external influences
Human memory is fallible and reconstructive. Confidence or vivid recollections does not guarantee accuracy, especially when litigation or pre-trial preparation distorts memories
Due to memory's unreliability, documentary evidence is crucial for assessing witness credibility, with contemporaneous documents offering a clearer reflection of events
Courts prefer inherently probable evidence, consistent with the circumstances. The less likely an event, the stronger the evidence required to prove it
Courts prefer evidence which is consistent with facts admitted by the parties or matters of common knowledge or experience
Courts prefer evidence that a witness gives against his or her interest, as it suggests a higher degree of credibility
Independent witnesses are crucial for resolving disputes and evaluating their credibility is essential to establishing an objective view of events
Credibility and reliability are distinct concepts; a witness can be truthful but still make errors due to flawed memory
If a witness's testimony contains contradictions, the court must determine which parts to reject
Avoid making judgments about a witness's overall credibility based on isolated lies; understand the reasons for dishonesty to see if it affects other parts of their testimony
Rejecting a witness's entire testimony because of one lie can lead to overlooking potentially valuable evidence
In cross-examination, failure to challenge certain evidence can impact the fact-finding process.
Indicators of Potentially Unreliable Evidence:
Adapted from Painter v Hutchinson [2007] EWHC 758 (Ch), these indicators help assess witness reliability:
Evasive and argumentative answers
Avoiding direct answers
Blaming legal advisers for documentation (statements of case and witness statements)
Shortcomings in evidence discovery
Self‑contradiction
Internal inconsistencies
Shifting narratives
Selective disclosure of documents or information.
These propositions and indicators offer a practical framework for legal professionals navigating the complexities of witness evidence. As highlighted in the LL UP Pty Ltd v Kegland Distribution Pty Ltd case, they underscore why contemporaneous documentation remains a cornerstone in accurately assessing witness testimony and ensuring fair outcomes in commercial disputes.
Facing a Complex Commercial Dispute?
The importance of clear, reliable evidence can’t be overstated. Our experienced Commercial Litigation and Insolvency team understands the value of contemporaneous documentation in strengthening your case. Contact us today for expert advice and strategic support in navigating complex disputes.
[1] Paragraph 29.
