FITZGERALD v WARATAH TOWAGE PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MAHONEY, MEAGHER and HANDLEY JJA 27 October 1994, 24 March 1995 [1995] NSWCA 148 NEW TRIAL — IRREGULARITY — DENIAL OF PROCEDURAL FAIRNESS — RESULT NOT AFFECTED — NEW TRIAL REFUSED The appellant alleged a denial of procedural fairness by the trial judge who terminated an earlier award because she was satisfied that any relevant incapacity had ceased - in her reasons the trial judge made reference to the worker's behaviour in court - the appellant submitted that the trial judge was not entitled to have regard to the worker's behaviour outside the witness box without giving the worker's counsel an opportunity to deal with it - Held: (1) Reliance on her observations outside the witness box was an irregularity involving a denial of procedural fairness, GIO v Bailey (1992) 27 NSWLR applied. (2) Not every departure from the rules of natural justice will entitle the aggrieved party to a new trial, Stead v SGIO (1986) 161 CLR applied. (3) In the light of the medical evidence and a film taken of the appellant's activities the Court would not order a new trial because a properly conducted trial could not possibly have produced a different result. Mahoney JA On 14 December 1983 his Honour Judge Burke made an award in favour of the appellant worker based solely upon an injury to the worker's right shoulder and the incapacity resulting from it. In 1989 an application was made to the Compensation Court to terminate that award. On 21 June 1991 her Honour Judge O'Toole terminated the award with effect from 27 April 1989. The worker has appealed to this Court against her Honour's order. As Handley JA has indicated, the appeal has been limited to one ground described as a denial of procedural fairness. Her Honour in her judgment referred to the fact that, during the proceeding, the worker had acted in the court in a manner "apparently normal and unremarkable" and consistent with her impression "of his athletic build and physical fitness". She formed the impression "that the worker has sought to maximise the effect of any discomfort he suffers". The contention has in substance been that her Honour relied upon these observations without directing the attention of the parties to the fact that she proposed to rely on them and that this involves a denial of procedural fairness: Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304. Procedural unfairness ordinarily involves an error of law. However, the appeal has been conducted upon the basis that it is not limited to questions of law. I agree with Handley JA that the appeal should be dismissed. The substantial evidence relied upon for the employer was a film depicting the worker's activities. That film, her Honour concluded, suggested that the worker no longer suffered incapacity by reason of the injury in question to the shoulder. There is, in my opinion, no error in that finding. Her Honour relied also upon an incident involving the movement of a dinghy in November 1988. She said: "The worker subsequently made concessions which are consistent with my conclusion that he is, at least, an unreliable witness. He may even have consciously asserted the contrary of a matter he believes to be true but perhaps 2 UNREPORTED JUDGMENTS it is unnecessary for me to make comments which are squarely adverse to the Applicant's assertion that he is a truthful witness. As I understand the thrust of the worker's evidence, he is 'limited' regarding the degree of his ability to perform any type of work. It emerged that over the years, the worker has engaged in a number of activities including work with a Scouting group: he says, for example, that he has needed assistance to beach boats." Her Honour considered the evidence of a Mr Eisman and a Mrs Fitzgerald and then said: "Moreover, viewed against the evidence as a whole and contrary to the worker's evidence, I have concluded that during or after lifting of the dinghy in late November 1988, the worker was injured or disabled or incapacitated, as a consequence of the condition of his lumbar spine." She referred to the evidence of medical witnesses and said: "On the whole of the evidence, I think it probable that by November 1988 when the worker lifted and moved the dinghy, in company with Mr Eisman, he was not suffering any disability or incapacity occasioned by injury and particularly by injury to his right shoulder, caused or exacerbated by the nature and conditions of employment with the employer." For the reasons she then indicated, she terminated the award. Counsel informed the Court at the commencement of the hearing of the appeal that the appeal was not limited to a point of law but, as I infer, was a general appeal. The nature of the appeal is governed by s32 of the Compensation Court Act 1984. S32 was relevantly amended by Act No 118 of 1989. That Act amended s32 to allow, in effect, an appeal by way of rehearing within s75A of the Supreme Court Act 1970. But by CLS of the Fourth Schedule to the Compensation Court Act, as amended by the 1989 Act, provision was made as to when that amendment should take effect. The construction of CLS is not without some complication. I shall therefore consider the effect of the judge's assumed error of law upon alternative bases. If the appeal to this Court is properly a rehearing within s75A of the Supreme Court Act and s32 of the Compensation Court Act 1984, I am of opinion that on the evidence her Honour's findings were correct. As on a rehearing, I would come to the same conclusions. I would do so without taking into account what her Honour said as to the actions of the worker in the Compensation Court in the course of the hearing before her Honour. Upon that basis, I would affirm the order which her Honour made. If the matter were to be dealt with upon a different basis and it was necessary to consider the effect upon her order of an error of law such as was here relied upon, I would come to the same conclusion as that adopted by Handley JA. The issue before the judge was whether the effects of the injury and the incapacity earlier found had ceased. Her Honour found that it had. It is important to understand the basis on which she did so. It was open to her to arrive at the conclusion on several different bases. Thus, she might have concluded, from what she saw in the court, that the worker was a witness lacking credibility and she might, for that reason, have rejected his evidence and been influenced to accept the evidence of others in concluding that by 27 April 1989 his incapacity had ceased. Alternatively, she might have approached the matter by treating what he did in court as appropriate to be recorded but by deciding whether the incapacity had terminated upon the basis of the findings separately made by her as to the video record of his actions and what he did in relation to the dinghy. If URJ FITZGERALD v WARATAH TOWAGE PTY LTD (Handley JA) 3 she approached the matter on this second basis, then the inference she drew from what she saw of the worker in the court room had no effect upon her conclusion that the incapacity had terminated. In that event, the fact, if it be such, that she erred in law as suggested had no effect upon her finding that the incapacity was terminated but was, in the relevant sense, merely collateral to it. On that basis, the error of law would not warrant the reversal of her finding. In my opinion, what her Honour did in this case fell within the second of these. It is, in my opinion, clear that she relied upon what she saw in the video and, to the extent that she did, upon what she took from the evidence of the inquiry agent Mr Lowe. She relied upon the "concessions" to which she referred in her judgment and her conclusion as to the circumstances in which the dinghy was lifted. I am satisfied that the proper conclusion from her judgment is that it was upon these matters that she relied in concluding that the incapacity had been terminated. Accordingly, upon either of these bases, I would come to the conclusion that the appeal should be dismissed with costs. As Handley JA has pointed out, the appeal has been conducted upon the basis of a ground of appeal which was not taken until shortly before the matter came before this Court. Were I, with a full appreciation of the facts, to consider whether leave should be granted to amend the notice of appeal to add that ground, I would refuse leave. However, the matter has been argued and I have dealt with it upon that basis. Meagher JA I agree with Handley JA. Handley JA This is an appeal by a worker from the decision of O'Toole CCJ given on 21 June 1991 terminating with effect from 27 April 1989 a continuing award made by Burke CCJ on 14 December 1983. Her Honour was exercising the power conferred by s17(4) of the Compensation Court Act to reconsider any matter dealt with by the Court and to rescind or alter any decision previously given by it. Her Honour terminated the earlier award because she was satisfied that there had been a material change in the worker's condition and that any relevant incapacity had ceased prior to 27 April 1989. The worker appealed within time and filed an amended notice of appeal on 11 February 1992. The grounds in the first amended notice of appeal were abandoned at the hearing. On 27 October 1994 when the appeal was called on the appellant applied for leave to further amend the notice of appeal to raise a new ground alleging a denial of procedural fairness by the trial judge. The Court allowed the amendment. The appellant relied on two passages from her Honour's reasons to establish the denial of procedural fairness relied upon. These were: "The worker was seen in the court room, on a number of occasions. Throughout the period when I observed him and particularly when he was giving evidence, he made apparently normal use of his cervical spine and both upper limbs, including his hands. He moved in an apparently normal and unremarkable manner, consistently with my impression of his athletic build and physical fitness." The second passage was: "On one occasion, sitting in the court room, the worker's movement was accompanied by an elaborate facial expression, from which I thought he wished me to imply his discomfort. Immediately thereafter, he sat comfortably, maintaining good posture for an extended period. I had the impression that the worker has sought to maximise the effect of any discomfort he suffers." 4 UNREPORTED JUDGMENTS The employer was seeking the determination of a continuing award and had to prove that all relevant incapacity had ceased. Its case was supported by evidence on film of the worker's activities on 21, 22 and 23 April 1989 and the worker's credit was crucial. Her Honour found that the worker "'is, at least, an unreliable witness" and this was clearly an important factor leading to her ultimate decision. The appellant submits that her Honour was not entitled to have regard to the worker's behaviour outside the witness box without disclosing her observations and giving the worker's counsel a reasonable opportunity to deal with them either by recalling the worker or in address. I do not attach significance for present purposes to her Honour's observations of the worker in the first passage which related "particularly" to the period when he was giving evidence because his movements and behaviour entering and leaving the witness box and while giving evidence took place in full view of the legal representatives for both parties. Conventionally, a witness' behaviour in and about the witness box has been treated as something which a trial judge is entitled to take into account in assessing the credibility of a witness. However her Honour's observations referred to in the second passage are in a different category. This behaviour took place at the back of the court and would not have been observed by the worker's legal representatives who had no opportunity to deal with it. Reliance by her Honour on her observations during this incident was an irregularity involving a denial of procedural fairness. See GIO v Bailey (1992) 27 NSWLR 304 and the cases there cited. However not every departure from the rules of natural justice at a trial will entitle the aggrieved party to a new trial. See Stead v SGIO (1986) 161 CLR 141. The test which must be applied by this Court is that stated in the joint judgment in that case at 147 as follows: "All that the appellant needed to show was that the denial of natural justice deprived him of the possibility of a successful outcome. In order to negate that possibility, it was,... necessary... to find that a properly conducted trial could not possibly have produced a different result." Compare Armstrong v Great Southern Gold Mining (1911) 12 CLR 382 at 390. It is therefore necessary to examine with some care the course of the hearing and her Honour's reasons for deciding to terminate the award. The worker claimed before Burke CCJ that he had sustained work injuries to his right shoulder, neck, lumbar spine and the right side of his body. Unfortunately the only record of his decision was on a single sheet of paper headed "Findings". In order to understand those findings and the award it was necessary for O' Toole CCJ to consider the evidence before Burke CCJ and the issues raised for his determination. After a careful review of that material she concluded that the only relevant injury the Judge had found which had resulted in incapacity was to the worker's right shoulder. Her Honour said that the film of the worker's activities in April 1989 showed him making unremarkable use of his arms, cervical spine and body as a whole. He scaled and worked on a ladder. She concluded that he was not apprehensive in any way about his ability to use his right upper limb, in a normal and even unusual manner. She thought that the worker displayed confidence in the use of all his limbs and that some of his activities as filmed required agility or strength. The film fully supports her Honour's conclusions. She also relied upon an incident on 26 November 1988 when with the assistance of Mr Eisman he carried a ten - twelve foot long huon pine dinghy weighing about sixty pounds for about a hundred metres. According to his history recorded by Dr Rose, whom he had URJ FITZGERALD v WARATAH TOWAGE PTY LTD (Handley JA) 5 seen on 28 November 1988, this effort caused "considerable aggravation of his lower back pain". In his report Dr Rose noted: "On examination... he was very tender over the upper cervical spine... both centrally and over the apophyseal joints. He complained of parasthesia in the right arm but I was unable to demonstrate any neurological findings. The range of movement of his neck was restricted more markedly to the left but there was some restriction to the right." Dr Rose had previously seen the worker on 25 July and 17 August that year. On the first occasion the worker was complaining of upper thoracic back pain. Dr Rose reported: "On examination at that time he had a slight lumbar scoliosis and quite marked spasm of the left paravertebral muscle. He had decreased forward flexion of the thoracic and lumbar spine and there was little else to find." An x-ray was arranged and having seen the report, Dr Rose noted: "X-ray showed slight narrowing of the C3/C4 disc space. The appearance was felt to be compatible with minimal disc degeneration. There were no other abnormalities noted. X-ray of his right shoulder was normal. No calcification of the soft tissues was noted." When the worker again consulted Dr Rose on 28 November he complained of the "worsening of his pain" while carrying the dinghy and since. On that occasion he also reported being involved in a head-on motor vehicle accident on 19 November where he sustained bruising across the chest and possibly a minor whiplash. Dr Rose again saw the worker on 29 December 1990 who complained of having experienced about 4-6 "attacks of pain in his back" in the preceding twelve months. When originally asked in evidence what part of his body was injured in the dinghy episode he said: "My neck and my shoulder" but later he agreed that he "may" have told Dr Rose that he had experienced considerable aggravation of his lower back pain and also agreed that he had "a low back problem". The worker called Mr Eisman. Her Honour said that this witness' evidence was damaged in cross-examination and was not of assistance. However it became clear that he had been aware for a considerable time of the worker's disability and incapacity in his lumbar spine. Dr Rose also reported that on 4 January, 1990 while he was on leave the worker had seen one of his associates "with another aggravation of his low back pain". Dr Rose never recorded any complaint of shoulder symptoms by the worker. The Judge thought that he attributed any disability or incapacity to the worker's lumbar spine and that his upper limb symptoms were unrelated to any shoulder injury. She also noted that the worker had seen Drs Bishop, Burton and Flanagan but that their reports had not been tendered. Dr Pillemer was called in the worker's case. The Judge had difficulty with some of his evidence but noted that in his view the worker's disability or incapacity was due to the state of his cervical spine. She concluded: "On the whole of the evidence I think it probable that by November 1988 when the worker lifted and moved the dinghy... he was not suffering any disability or incapacity occasioned by injury and particularly by injury to his right shoulder, caused or exacerbated by the nature and conditions of his employment with the employer... The worker may, from time to time, have suffered symptoms in his cervical and/or lumbar spine. I have already recorded my conclusion that he seeks to overstate or exaggerate the effect of any such symptoms." 6 UNREPORTED JUDGMENTS Her Honour's conclusion that Burke CCJ based his award solely on an injury to the worker's right shoulder was not challenged. Given the evidence about the carrying of the dinghy on 26 November 1988, the history of back pain recorded by Dr Rose and his findings on examination, the absence of reports from Drs Bishop, Burton and Flanagan, the absence of complaints of pain or clinical findings relevant to a shoulder injury, and then the film evidence, I am comfortably satisfied that her Honour's findings were correct. In the end the critical factor, apart from the film evidence, is the complete absence of any reliable history of pain in or associated with the worker's right shoulder between 1988 and 1990.Despite the regrettable irregularity I have reached the firm conclusion that the worker was not thereby deprived of the possibility of a successful outcome and that a properly conducted trial could not possibly have produced a different result. It is significant that although her Honour gave an ex tempore judgment, experienced counsel made no complaint about the irregularity at the conclusion of the judgment or in either the original or first amended notices of appeal. The point was only taken by new counsel shortly before the hearing of the appeal three years later. This strengthens the conclusion I have independently reached that the employer had an overwhelming case at the trial and that it never occurred to the worker's legal representatives at the time that this irregularity would have made the slightest difference to the result. In my opinion the appeal should be dismissed with costs. Appeal dismissed with costs. COUNSEL: Appellant: G M WATSON Respondent: J L SHARPE SOLICITORS: Appellant: WHITE BARNES Respondent: EBSWORTH and EBSWORTH