SHAM SHON ISAAC v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES; ZARDY ISAAC v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL SAMUELS, MEAGHER and HANDLEY JJA 30 August 1991, 30 August 1991 [1991] NSWCA 155 DAMAGES — damage denied because plaintiff had sustained no injury — judge's findings wrong and new trials ordered. Samuels JA These are three appeals from judgments of Judge Conomos in relationto three actions for damages arising out of two motor vehicle accidents. I confess that I have found these difficult cases to determine and I acknowledge the considerable assistance I think we have had from Mr Petty of counsel for the appellant and Mr Bell of counsel for the respondent. The facts barely stated are these. The appellants are husband and wife. The male appellant was involved in two motor vehicle accidents. The first was on 21 September 1986 and the second on 23 October 1986. He brought proceedings in respect of both. The female appellant, his wife, was a passenger on the second occasion on account of which she sued. Each appellant contended that an injury to the cervical spine or a soft tissue injury in that area, commonly known as a whiplash, had been the consequence of each accident. The actions came before Judge Conomos on 2 April 1990 and his Honour dismissed each claim on the basis that neither appellant had sustained any injury in the incidents to which I have referred. The learned judge in his judgment made some severe criticisms of the credibility of each appellant. He said first of all: "IT do not believe the male plaintiff, I found him to be long winded and unconvincing.... I do not believe this plaintiff, he is an opportunist. He has made up his mind to take advantage of the Court system." His Honour went on to suggest that the plaintiff, who was at the time in receipt of unemployment benefits, knew that "if all else fails, " that is to say, if his litigation which, ex hypothesi, his Honour at that point was stigmatising as either without merit or frankly false, produced no dividend, the plaintiff could fall back on unemployment or sickness benefits. Then his Honour said that the male plaintiff, his wife and his brother-in-law were most unconvincing. The brother-in-law was involved because he had been the driver in the first of these two accidents. Having made some pejorative comments about his perception of the brother-in-law in the witness box and having pointed out some inconsistency in the female appellant's evidence Judge Conomos said of the wife: "She is an opportunist and a very clever cunning lady who, with other members of her family, have done their best to use the third party system as a milch cow. I do not believe her at all, she suffered no injuries in this motor vehicle accident." 2 UNREPORTED JUDGMENTS It will be evident from this that many of his Honour's conclusions appear to be based upon a view of the credit of the appellants based upon his Honour's perception of their performance in the witness box, that is to say, their demeanour. It is not modern doctrine that an appellate court must defer to a trial judge's estimate of credibility if it is founded upon his view of the demeanour of witnesses whom he, of course, has seen and the appellate court has not. It has many times been said that this confers upon the trial judge an advantage which the appellate court can never enjoy. However, although these principles have been in the law for many years, at least since Coghlan v Cumberland (1981) Ch 704, they have recently been emphasised by the High Court in cases such as Jones v Hyde (1989) 63 ALJ 349 and Abalos v Australian Postal Commission (1988) 171 CLR 167. Accordingly, appellate courts must take care to ensure that they do not trespass into a fact finding area substantially reserved for the primary judge. Indeed, in the earlier case of SS Hontestroom v SS Sagaporack (1927) AC 37 at 47, Lord Sumner said that "if his" that is the trial judge's - "estimate of the man forms any substantial part of his reasons for his judgment" the trial judge's conclusions of fact should, as I understand the decision, be let alone. However, I think that that proposition must be read subject to what was said in Watt (or Thomas) v Thomas (1987) AC 484, in which the headnote includes this holding: "The appellate Court is, however, free to reverse the trial judge's conclusions if the grounds given by him therefore are unsatisfactory by reason of material inconsistencies or inaccuracies or if it appears unmistakably from the evidence that in reaching them he has not taken proper advantage of having seen and heard the witnesses." In the present case the circumstances, to flesh out a little more the very laconic account of the facts which I have so far given, ran in this way. There was no contest at the trial about there having been two genuine motor car collisions. It was not suggested that these two impacts had been deliberately contrived in furtherance of some fraud. In respect of the first accident there were photographs of the damage to each of the motor vehicles, and in respect of the second accident a photograph of the damage to the male appellant's vehicle. There was in evidence the repair bills for both vehicles involved in the first accident from which it appears that the damage to one vehicle was in excess of $2700, and to the other in excess of $1600. In each case the driver of the vehicle at fault made a written admission of liability, and there is no evidence that there was any association of any kind between either of the appellants and either of these drivers. Indeed, the evidence is, and there was no challenge to it, that following the first accident the parties repaired to the Fairfield Police Station where the first of these admissions was actually written out. So, it would seem to follow that the circumstances in which any injury was sustained, if any injury occurred, are without suspicion. At least there is no evidence which impugns them. The learned judge at the end of his judgment said: "T hasten to add there is no independent evidence from any hospital because they did not attend any nor were the police called in relation to these accidents." The police were not called, it is true, but the parties went to the police in the first case; and I can see no reason why they should have called the police to the second accident nor any basis for criticising them for having failed to do so. \GRIAM SHON ISAAC v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES3 ZARDY ISAAC v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES (Samuels JA) Following the accident each appellant went to a local doctor and was examined, and according to the medical reports manifested signs of soft tissue injury in the cervical region. I say signs although, strictly, complaints of pain on palpation are subjective rather than objective. Nonetheless, as Mr Petty pointed out in argument, there is nothing from the medical reports which suggests that either of these doctors had any suspicions about the genuine nature of each of the appellant's complaints of pain, discomfort and limitation of movement. Thereafter it seems to me that the proceedings took a normal course, although I think perhaps that the delay which ensued was rather more than is normal even in these difficult times. It follows that any criticism which depends upon the failure of the parties to attend a hospital seems to me to be entirely without substance. It is not suggested that either appellant had injuries of severity enough to warrant such a course. I suppose that this Court may be permitted to know that the symptoms which sometimes follow injuries of this sort take a little time to manifest themselves in pain and limitation of movement. TWO days or so after the accident occurred the appellant sought medical advice. That advice is documented; the history is set out together with the medical diagnosis. I should add at this point that in the evidence discrepancies concerning histories were established in cross-examination; and at least to one of them the learned judge referred. These are not, however, in my view, at all exaggerated, or gross, or entirely out of experience in this class of litigation. Then his Honour having made some criticisms of the male appellant's work record and of his evidence that he received only $52 a week from running a snack bar at an establishment known as Sweethearts Disco in Fairfield, with which the learned judge had some familiarity, no doubt in a wholly professional way. This criticism does have some substance because it seems to have been a very small sum of money for doing what the male appellant says he did. His Honour went on to deal with the female appellant's brothers. There were, some said, seven or eight. Other evidence computed them at five. The male appellant's evidence was that most, if not all of them, had been injured in motor vehicle accidents in which they had sustained neck injuries. The evidence about this in cross-examination of the male appellant is in substance (I will not refer to it all) to this effect: "Q. Did they, five of your wife's brothers, say that they had been in motor vehicle accidents and hurt their necks in that period, that is from July 1986 until June 1987? A. Yes." Now, I entirely understand that this evidence and subsequent evidence in which the male appellant said that when the family met the brothers sometimes discussed their sore necks, conjures up images which are curious to say the least, even bizarre. However, I find it impossible to conclude that this is evidence upon which could be founded any rational answer to the claim of either appellant. Let it be supposed, and the evidence falls far short of this, that the claims by the five brothers were without merit, indeed fraudulent. Let it be supposed further that both their sister and her husband knew of those circumstances. Even so I cannot understand how that evidence alone could constitute some sort of defence to the appellants' claims at a trial, or some disqualification of their right to damages otherwise established. Indeed, all that the evidence shows, apart from what I have just referred to, is that of the brothers one, that is the Mr Moshi who gave evidence, had a settlement of $8000 from his neck injury, and that another of them had made a claim at 4 UNREPORTED JUDGMENTS which the male appellant gave evidence, the fate of which is unknown. Whether the other brothers ever made any claims or not the evidence does not reveal. Ihave spent a little time on this aspect because it seems to me that the assumed suspicions stemming from the evidence concerning the brothers exerted considerable influence upon his Honour's mind. I repeat that what his Honour said was: "She is an opportunist and a very clever cunning lady who, with other members of her family, have done their best to use the third party system as a milch cow." And there was an earlier reference to the male appellant's uneasiness when being cross-examined about the five brothers-in-law also having neck injuries and making claims. These statements are not wholly accurate, and it seems to me that his Honour was employing this material for a purpose which it will not serve. I have indicated my view of the relevance of the brothers' activities, and at this point need not repeat what I have just said. Accordingly, although the learned judge obviously relied upon the impression which the appellants' demeanour made upon him while they were in the witness box, which he was perfectly entitled to do, and to that extent his judgment is immune from review, he appears also to have taken account, in a significant way, of facts which were irrelevant to any matter which he had to determine and which, in part, were inaccurately found or stated. In those circumstances the question seems to be the one which Mr Bell has clearly stated for us. If a judgment will stand upon independent footings then it may be possible to remove one support but leave the edifice standing. This, in my view, is not such a case. It seems to me that these findings are interrelated, and that his Honour's view of demeanour merged to a degree in his Honour's view of relevance, because I assume he thought relevant the activities (of which there was little proof as I have said) of the female appellant's brothers. Contrariwise it may be that with the latter circumstances in mind he was moved to take a more unfavourable view of the demeanour of the witnesses than he might otherwise have done. The two strands are closely intermingled and cannot, in my view, he separated in order to save the judgment. As I said at the beginning I have found this a difficult case. I entirely understand that the learned judge might well have treated the matter initially with some reserve, and I would respectfully commend his zeal in protecting inroads upon the public purse. But the judicial mind must seek to be satisfied by persuasive and admissible evidence, and that, in the present case, was lacking to the extent necessary to support the learned judge's conclusions. Accordingly, in my view, each of the appeals succeeds. The judgments below must be set aside and a general new trial ordered. The respondent must pay the appellants' costs of the appeal. Meagher JA In each of the three cases which are the subject of the present appeals his Honour Judge Conomos found for the defendant. He did this because he disbelieved the plaintiff. In each case his Honour expressed the view that the plaintiff was probably in conspiracy with his relatives, guilty of defrauding the social security system and the third party system. It is conceded there is no evidence to justify this view. The problem therefore becomes whether the judge's disbelief of the plaintiff's case is founded in whole or in part on this strange view on the one hand, or whether the judge \GRIAM SHON ISAAC v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES§ ZARDY ISAAC v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES (Handley JA) disbelieved the plaintiff in any event and came to this erroneous finding by way of additional reasons on the other hand. If the former is the case there must be a new trial. If the latter is the case there can be no justification for upholding the appeal as the finding would be a finding based on credibility. My reluctant view is the former. I agree with Mr Justice Samuels and with the orders proposed. Handley JA I also agree that the transcript of the evidence of the first appellant, Mr Sham Shon Isaac, his brother-in-law, Mr Admon Moshi and Hasadi Isaac reveal what appear to be significant inconsistencies and improbabilities. I particularly refer to the evidence of Mr Sham Isaac that the food stall he operated in Sweethearts Disco at Cabramatta on Thursday and Saturday evenings produced an average weekly profit of only $52 from serving perhaps four or five people all night or sometimes twenty, although the Disco itself might hold up to 1500 patrons. Other examples could be referred to. They were discussed in argument but as this Court is ordering new trials in each case it would be inappropriate for me to refer to them any further. The reasons for judgment of the trial judge are unsatisfactory in a number of respects which have been referred to by Mr Justice Samuels. I agree with his Honour's comments in relation to those unsatisfactory features. The medical reports on the appellants' by doctors qualified on their behalf indicate that on a pessimistic view of their futures they had suffered only modest injuries. In the result there was material before the judge which could have supported modest or minimal verdicts for the plaintiffs or verdicts for the defendant. It is unfortunate that the trial Judge's failure to confine his reasons to matters which were strictly in evidence before him and which were logically probative of some judicial conclusion has rendered it necessary for this Court to order new trials. The Judge's haste to get on with the list has, in the end, resulted in unnecessary appeals and unnecessary new trials. I agree with the orders proposed. Each appeal is allowed. The judgments below must be set aside and general new trials ordered. The respondent must pay the appellants' costs of the appeals. Costs of the first trials should be disposed of by the judge presiding in the second trial. Counsel for the Appellant: G PETTY Counsel for the Respondent: P BELL Solicitors for the Appellant: FRISINA and ASSOCIATES Solicitors for the Respondent: R WALTERS, SOLICITOR FOR GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES