ZAPPIA v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL MAHOoNney JA, PRIESTLEY JA and Hope A-JA 6, 25 February 1991 [1991] NSWCA 292 Appeal from District Court — Damages in two motor vehicle accidents — Extent of plaintiff's injuries in issue — Judge accepted plaintiff as credible witness — Court of Appeal may come to a different conclusion or may set aside Judge's finding if Judge's assessment of credibility affected by a matter of fact or a conclusion as to facts shown to be erroneous — Judge's finding affected by his conclusion that "the bulk of the medical evidence is against the plaintiff' — Error as to the effect of "the bulk" of the medical reports — Conclusion as to the plaintiff's credibility affected by that conclusion — Held: New trial necessary. Mahoney JA, Priestley JA and Hope A-JA. On 25 February 1991 the Court made the following orders in this appeal: 1. Judgment below set aside. 2. Proceeding No DC 33766/86 returned to the District Court for retrial. 3. Defendant to pay the costs of the first trial. 4. Plaintiff to pay the costs of the appeal. An error occurred in the form of Order 4: it should have read: 4. Plaintiff to have the costs of the appeal. Counsel for the parties have been informed accordingly and have offered no objection to the correction of the error. Order 4 is therefore corrected to read: 4. Plaintiff to have the costs of the appeal. Mahoney JA. The plaintiff was involved in two motor vehicle accidents: the first occurred on 4 February 1985 and the second on 23 August 1986. The defendant accepts that it is liable in damages in respect of each of these accidents. The plaintiff sued the defendant for damages in two separate proceedings in the District Court. On 19 September 1988 his Honour Judge McLachlan heard the cases together and gave judgment for the plaintiff in respect of each accident as follows: in the first proceeding judgment for $49,411.28 and in the second proceeding $15,500.60. The plaintiff has filed a notice of appeal. The form of the notice of appeal refers to both proceedings but the errors alleged relate to the judgment given in respect of the first accident, namely, that for $49,411.28. In assessing the damages to be awarded to the plaintiff his Honour took into account the following: Out-of-pocket expenses $1460.60 Sick pay refundable by the plaintiff 5820.00 Past economic loss 27655.00 Interest on past economic loss 5945.83 2 UNREPORTED JUDGMENTS General damages 25000.00 $65881.43 His Honour held the plaintiff to have been 25 per cent responsible for the accident, reduced the damages to be awarded accordingly and gave judgment for $49,411.28. Mr Cullen, for the plaintiff, submitted that his Honour had erred in respect of four main matters: the award of $25,000 for general damages was appealably inadequate; the calculation of past economic loss was erroneous in that, inter alia, it failed to take into account the value of the superannuation entitlements lost by the plaintiff; there was no allowance for future economic loss; and there was no allowance for the cost of future treatment which the plaintiff would have to undergo. Mr Cook, for the defendant, contested each of these matters. Central to the submissions made by both counsel is the assessment made by the learned judge of the plaintiff's credibility and the manner in which his Honour made that assessment. The plaintiff had been injured in a motor vehicle accident. He had been for many years and was involved in the farm produce business. The business was conducted by a group of entities in which he and his two brothers had interests. The plaintiffs duties in relation to the business included, though were not limited to, the checking of some of the goods dealt with in the business. In the course of doing this, the plaintiff said, he was required to lift boxes of fruit or otherwise manipulate them so that he could assess the quality of what was being dealt with by the business. One of the substantial complaints made by him was that, as the result of the injuries suffered by him in the accident, he had had and still had at the date of trial pain and limitation of movement in respect of his cervical spine and his lumbar regions, as well as other physical and emotional problems. For present purposes it is not necessary to detail the precise nature or extent of what the plaintiff claimed in this regard. The extent to which the accident had caused the plaintiff pain and disability was in issue at the hearing. The plaintiff gave detailed evidence as to the effect of the accident upon him and claimed significant continuing disabilities affecting the physical duties which, in the business, he would ordinarily have carried out. His evidence in this regard was contested, during the evidence and, as I infer, during address. The learned judge, in a considered judgment, said: Whilst undoubtedly the plaintiff being previously a very fit man and sustaining two accidents involving various parts of his body is understandably limited by his health over the last three and a half years, I have the belief that he is in fact better than as presented. I accept that he has some continuing problems but I have a doubt as to their severity, and as to whether they are related to one or other of the accidents. Such conclusions and beliefs of course must have asubstantial effect on my findings in relation to the claim for economic loss. I note that one of the counsel suggested that I might have to use the judgment of Solomon in this case. I can only do the best I can on the evidence and try to reach a reasonable result which is fair to both parties. One thought which is prominent in my mind is that the bulk of the medical evidence is against the plaintiff which leads me to the respectful suggestion that the plaintiff must try to forget the accidents and get on with life which even on a golf handicap of 15 is not that bad for a 52 year old. UWAPPIA v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES (Mahoney JAB It has not, I think, been contested in argument — at least, in my opinion, it is clear — that his Honour, by what he said, indicated that he did not accept the plaintiff's evidence in full and that he discounted to a significant extent what the plaintiff had said. This was reflected in what the learned judge did in assessing damages. He did not accept that the plaintiff would suffer economic loss in the future and made no award for future loss of earnings. He gave only a limited award in respect of superannuation rights. And the award for general damages $25,000, including 'an allowance' in respect of loss of superannuation rights of an unspecified amount, suggests, I think, that his Honour significantly discounted the plaintiff's evidence both as to the past and the future effect of the accident upon him. If this assessment of the plaintiff's credibility and, accordingly, the evidence as to his condition be accepted as the basis for assessment of damages, then Mr Cullen, for the plaintiff, would face significant difficulties in respect of some at least of his submissions. However, Mr Cullensubmitted that his Honour's finding as to the plaintiff's credit should not be accepted and that this Court was, in the particular circumstances of this case, entitled to set it aside. The position of this Court in relation to findings of a trial judge as to the credibility of a witness has been definitively stated by McHugh J in a judgment agreed in by the other members of the High Court in Abalos v Australian Postal Commission (1990) 65 ALJR 11 at 16. His Honour said: Consequently, where a trial judge has made a finding of fact contrary to the evidence of a witness but has made no reference to that evidence, an appellate court cannot act on that evidence to reverse the finding unless it is satisfied "that any advantage enjoyed by the trial judge by reason of having seen and heard the witnesses, could not be sufficient to explain or justify the trial judge's conclusion": Watt or Thomas v Thomas (1947) AC 484 at 488. However, it is accepted that in some circumstances this Court may set aside a finding of a trial judge notwithstanding that it has been subject to 'the subtle influence of demeanour': Voulis v Kozary (1975) 50 ALJR 59 and the cases referred to in Chambers v Jobling (1986) 7 NSWLR 1. This, in my opinion, may be done where the trial judge's assessment of the credibility of a witness has been affected by a matter of fact or a conclusion as to facts shown to have been erroneous. Thus, if, in coming to the conclusion that a witness is not credible the trial judge has been influenced to come to that conclusion by, inter alia, the fact that the witness's evidence is contrary to the evidence of another witness andexamination shows that it is not so contrary, then the appellate court may set aside the learned judge's conclusion as to the credibility. On one view, this was one of the matters at issue in Chambers v Jobling. Mr Cullen has submitted that this occurred in the present case. He submitted that his Honour, in arriving at a conclusion as to the plaintiffs credibility, was affected by his, the learned judge's, conclusion that 'the bulk of the medical evidence is against the plaintiff'. This, he submits, is inaccurate. Consequently, the learned judge formed his conclusion as to the plaintiffs credibility upon a false basis and his conclusion may be set aside. This submission raises, inter alia, two issues: whether it is true that 'the bulk of the medical evidence is against the plaintiff'; and whether the learned judge took that matter into account when he formed his assessment of the plaintiff's credibility. 4 UNREPORTED JUDGMENTS There was discussion in argument as to what the learned judge meant by 'the bulk of the medical evidence' and its being 'against the plaintiff'. The medical evidence was given in written form. At least three doctors gave reports which provided support for the plaintiff's claims as to his cervical, lumbar and other disabilities and the consequences of them. Doctors Searle, Alam and Sharah, in their reports, were, to varying extents but generally, supportive of the plaintiff's claim that he continued to have cervical and lumbar difficulties and that his working capacity was limitedgenerally in the manner to which he referred. Medical reports were tendered by the defendant from Doctors Goldie, Hudson, McGlynn, Basser and Bornstein. These reports, to varying extents, did not accept the complaints which the plaintiff made. They varied in their assessment of the plaintiff but in relation, for example, to his claims that he suffered pain and restrictions in the lumbar area they generally did not accept a substantial part of his case. Mr Cullen is, in my opinion, correct in his submission that, comparing the various medical reports, it is not accurate to say that 'the bulk' of the reports are 'against the plaintiff'. The reports of the three doctors on whom he relied provided strong support for what he said. The defendant's reports perhaps have outnumbered those of the plaintiff, but I do not think that his Honour meant, by 'the bulk' of the medical evidence, merely the number of the reports. But if his Honour did not refer merely to the number of the reports but to, eg, the general effect of them, I do not think that his Honour's assessment of 'the bulk' of the reports is accurate. In reaching this conclusion I have taken what his Honour has said according to its literal meaning. I suspect that his Honour may have intended something else. It may be that the learned judge meant to refer to 'the effect of the medical evidence'. But neither counsel suggested that there was error in the transcription of the judgment. Construing the judgment according to its terms, my conclusion is that Mr Cullen'ssubmission in this regard should be accepted. I conclude also that his Honour was, in assessing the plaintiff's credibility, affected by his conclusion as to the bulk of the medical evidence. His Honour properly indicated that the matter was 'prominent in my mind'. Mr Cook did not, I think, submit that this matter did not affect what his Honour did. I come now to consider the effect of my conclusion upon the determination of the appeal. Mr Cullen submitted that the court may put aside his Honour's conclusion as to credibility and form its own conclusion upon the extent and effect of the plaintiff's injuries. I do not think that this can or should be done. Any assessment of the plaintiffs condition will be affected by the extent to which the court is prepared to accept what the plaintiff has said, to the court and to the doctors who have seen him. This is a matter upon which in my opinion this Court cannot in the relevant sense form its own conclusion. What is accepted will or may be affected by the court's assessment of the plaintiff's credibility and the plaintiff's demeanour will or may be relevant in making that assessment. I am conscious of the evils of new trials and of the fact that the amount involved in this proceeding is relatively small. However, I do not see any proper alternative to a reconsideration of the matter at trial level. In my opinion, therefore, the judgment should be set aside. The relevant proceeding No DC 33766 of 1986 should be returned to the District Court for retrial. The defendantshould pay the costs of the first trial. The plaintiff should pay the costs of this appeal. Priestley JA. I agree with Mahoney JA. UWAPPIA v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES (Hope A-JAB Hope A-JA. I agree with Mahoney JA. 1. Judgment below set aside. 2. Proceeding No DC 33766/86 returned to the District Court for retrial. 3. Defendant to pay the costs of the first 5 trial. 4. Plaintiff to pay the costs of the appeal. Counsel for the appellant: I.D. CULLEN Solicitors for the appellant: G.J. SHARAH HENVILLE and CO Counsel for the respondent: C.M. COOK Solicitors for the respondent: G. WILSON