Can a Ferrcom Inference be Drawn in Respect of Expert Evidence?

In Abbey Laboratories v Virbac (Australia) Pty Ltd (No 3) [2025] FCA 1179 (24 September 2025), Jackman J, in the Federal Court of Australia, addressed the issue of whether a Ferrcom inference could be drawn in respect of evidence adduced from an expert, as opposed to a non-expert witness.  The drawing of such an inference, generally, was canvassed by Martin J (later Martin SJA) in Sullivan Nicolaides Pty Ltd v Papa [2012] 2 QdR 48 at [162], [170].  In Abbey – concluding against the application of the Ferrcom principle in the case of experts – Jackman J wrote:

[214]  In Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 (Ferrcom) at 418E — 419F, Handley JA extended the principle of Jones v Dunkel (1959) 101 CLR 298 to the case of a party failing to ask questions of a witness in chief on a particular topic. His Honour said that where such a failure indicates as the most natural inference that the party fears to do so, that fear is then some evidence that such examination in chief would have exposed facts unfavourable to the party. Accordingly, inferences should not be drawn in favour of a party that called a witness who could have given direct evidence when that party refrained from asking the crucial questions. The High Court has endorsed that reasoning in the less strongly worded form that where counsel for a party has refrained from asking a witness whom that party has called particular questions on an issue, the court will be less likely to draw inferences favourable to that party from other evidence in relation to that issue: Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; (2011) 243 CLR 361 at [63] (Heydon, Crennan and Bell JJ). That formulation better reflects the reasoning in Jones v Dunkel, whereby the relevant inference which may (not should) be drawn is that the evidence not called by a party would not have assisted the party (not that the evidence would have been adverse to the party).

[215]  In Ferrcom, Handley JA drew on a line of United States decisions, noting that there is extensive case law in the United States on this question. It should be noted, however, that there is a principle in federal courts and many state courts in the United States (embodied in r 611(b) of the Federal Rules of Evidence) that cross-examination should not go beyond the subject matter of the direct evidence (ie, evidence in chief) and matters affecting the witness’s credibility, although the court may allow inquiry into additional matters as if on direct evidence. By contrast, the applicable Anglo-Australian principle is that a witness may generally be cross-examined on any issue in the case: Heydon JD, Cross on Evidence (14th Australian edition, LexisNexis, 2024) at [17500]. There is thus a potential tactical advantage in the United States in limiting the scope of cross-examination by the simple expedient of a party not putting questions on an awkward subject to that party’s own witness, which is not available in Australia. In my professional experience, the natural inference most typically to be drawn in Australia from a party not leading evidence in chief on a particular subject is merely the innocuous one that the significance of the subject was not appreciated when the evidence in chief was prepared. That is especially so in the context of the modern practice of evidence in chief being given by affidavits, which are usually made and served weeks or months before the trial. Judges are not usually well placed to determine whether that is the appropriate explanation, rather than some supposed fear of the evidence being given. Accordingly, in my view, the appropriateness of drawing a Ferrcom inference needs to be approached with great caution.

[216]  In the present case, Abbey submitted in opening that a Ferrcom inference should be drawn on three matters which Professor Bunt had not addressed, although two of them fell away because certain claims of the Patent are no longer contested. The remaining matter concerns the issue of the obviousness of the range of concentration of the solvents in claim 2 of the Patent. I regard that as a misplaced criticism of Professor Bunt’s evidence. In the Formulation JER at [46], Professor Bunt explained that his response to the Task does not fall within claim 2 as he would not have selected the solvents referred to in claim 2, as he explained in his evidence concerning claim 1. There was therefore no need for him to deal with the concentration range of the nominated solvents in claim 2. Even on the widest possible view of Ferrcom inferences, such an inference could not be justified in the present case.

[217]  More fundamentally, in my view, there would rarely (if ever) be any scope for drawing a Ferrcom inference in the context of the contemporary practice in relation to expert evidence. I recognise that Ferrcom inferences have been drawn in relation to expert evidence in Ta Ho Ma Pty Ltd v Allen [1999] NSWCA 202; (1999) 47 NSWLR 1 at [11] (Handley JA); Gordon Martin Pty Ltd v State Rail Authority of New South Wales [2008] NSWSC 343 at [322] (Hall J); and Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd [2009] FCA 1495; (2009) 84 IPR 222 at [417] (Jacobson J). The New South Wales Court of Appeal regarded a Ferrcom inference as available in principle in relation to expert evidence in Wiki v Atlantis Relocations (NSW) Pty Ltd [2004] NSWSC 174; (2004) 60 NSWLR 127 at [72]–[73] (Ipp JA, with whom Bryson JA and Stein AJA agreed), but the question was left open in DIF III — Global Co-Investment Fund LP v DIF Capital Partners Ltd [2020] NSWCA 124 at [142] (Bell P, with whom Bathurst CJ agreed).

[218]  In addition to the general reservations which I have already expressed in relation to Ferrcom inferences, there are particular features of contemporary practice concerning expert evidence which point strongly away from such inferences arising. The Federal Court’s Expert Evidence Practice Note (GPN — EXPT) is broadly representative of the practice throughout the Australian States and Territories, providing for conferences of experts and joint expert reports (section 7), concurrent oral evidence (section 8), and a declaration in expert reports that the expert has made all the inquiries which the expert believes are desirable and appropriate and that no matters of significance which the expert regards as relevant have, to the knowledge of the expert, been withheld from the Court (Annexure A, para 3(i)). Those elements are buttressed by clear restrictions on attempts by parties to interfere with the expert’s expression of opinion (section 3), and duties on the part of experts to provide relevant and impartial evidence (section 4). Contemporary practice thus does not leave any effective room for a party tactically to seek to ensure that certain subject matter is avoided by an expert witness engaged by that party, at least in circumstances where that subject matter is dealt with by a competing expert witness. Whatever scope there may once have been for the drawing of a Ferrcom inference in relation to expert witnesses, I regard that now as having been superseded.

A link to the full case is here.