CROUCH v WYONG SHIRE COUNCIL SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL CLARKE JA, COLE JA and HUNTER AJA 4 March 1996 [1996] NSWCA 131 The appellant appealed from a decision of O'Toole CCJ in the Compensation Court rejecting his claim for lump sum benefits under the Worker's Compensation Act 1987 for a back injury suffered in 1988. The appellant submitted that not only did her Honour fail to disclose her reasoning process, but that, in the course of setting out events which occurred during the course of the trial, she made a significant mistake regarding a concession purported to have been made by the appellant in cross-examination, which apparent concession was not supported by the transcript of evidence. The Court allowed the appeal. Held: (1) It is necessary that the essential ground or grounds upon which a decision rests should be articulated. In many cases the reasons for preferring one conclusion to another also need to be given. These reasons should be sufficient to enable the parties to know the broad course of the trial judge's reasoning in leading to a conclusion: Soulemezis v Dudley (Holdings) Limited (1987) 10 NSWLR 247. (2) Where the judgment clearly demonstrates that the trial judge has understood the evidence properly and has exposed the reasons which led them to prefer one version of the evidence to another, earlier mistakes may be regarded as irrelevant. Where, however, the reasoning process is meagre, mistakes will compound the inadequacy of that reasoning process. Clarke JA. The appellant was born in 1936. He worked as an apprentice cabinet maker and then spent 16 and a half years as mess supervisor in the army. After discharge from that employment he had a number of jobs and, in 1978, he commenced employment with the respondent as a labourer. After nine months he reached the position of leading hand in a road construction gang. According to the history given to a doctor consulted on behalf of the respondent, his work was heavy. It involved concreting, using a jackhammer, besser block laying, concrete formwork and general construction work. Although, as appears from her Honour's judgment and the evidence in the case, the appellant had a number of health problems such as angina and other conditions and although he was thought to be grossly overweight the evidence does not reveal that prior to February, 1988 he lost any significant time from his work on account of his disabilities. It would appear from time to time he lost a few days for specific conditions but the evidence does not support the contention that he lost any significant time from work on account of a back disability. On 15 February, 1988, in the course of his work, he trod in a hole and suffered an injury to his back. He continued to work for the rest of the week and saw his doctor at the end of it and then went off work. He _ received physiotherapytreatment and was paid compensation for five weeks. He returned to work in March, 1988, late March, on light duties following receipt of a certificate from Dr Allport, who examined him on behalf of the respondent. 2 UNREPORTED JUDGMENTS During his work on light duties he was involved in dispensing petrol at the respondent's Charmhaven Depot. He then took some long service leave and retired from employment on the grounds of ill health in May, 1988, and has not worked since. It is apparent that he became, in July or August, 1988, an invalid pensioner. The grounds upon which he relied included angina, mild hypertension, blood pressure, obesity, breathlessness due to smoking and recurrent bronchitis and low back pain. Subsequently he made a claim for lump sum benefits pursuant to sections 66 and 67 of the Workers Compensation Act, 1987. His claim was heard by Judge O' Toole on 28 October, 1994 and, at the end of the evidence, her Honour rejected his claim and made an award for the respondent. Her judgment is notable for its brevity and the first ground of appeal is that her Honour failed, in her reasons for decision, adequately to expose her reasoning process. It is, I think, accurate to describe her judgment as containing two portions. The first two paragraphs deal shortly with the history and the opening address of counsel for the appellant and then, in the last three paragraphs, her Honour sets out her reasons. They were as follows: The applicant's gross body weight and poor general health have been remarked by medical practitioners in terms consistent with my own observations. The applicant is dangerously unfit and his breath was laboured. During examination in chief the appellant denied that prior to the incident on 15 February, 1988 he suffered any of the complaints from which he says he now suffers. In cross-examination the applicant conceded a back condition which incapacitated him for at least one period prior to the event of which he complains. The evidence is silent regarding the condition of the applicant's back, his complaints and whatever incapacitated him, prior to 15 February, 1988. There is common ground that the applicant suffers widespread degeneration in his spine. I do not infer from the applicant's oral evidence, nor documentary medical evidence, that the applicant suffered injury to his neck as a result of the incident he described. He was probably incapacitated for a period because of back injury but I am not persuaded that the sequelae of that injury persists. On the evidence I am not persuaded that the applicant suffers permanent impairment of the back or neck, nor that there is permanent loss of efficient use of any part of his body as a consequence of injury on 15 February, 1988.' Counsel for the appellant submits that not only did her Honour fail to disclose her reasoning process but that, in the course of setting out events which occurred during the trial, she made a significant mistake. This mistake was, he argued, compounded by an ambivalent statement as to the evidence relating to the appellant's back prior to 15 April, 1988. What was said to be the mistake was the passage which started with the words 'in cross-examination'. The court has examined the passage where the appellant was confronted with a suggestion that he took time off for a back condition in 1986 which, it would appear from the whole of the evidence, was the only incident to which her Honour could have been referring and I regret to say that the transcript of evidence does not support her Honour's statement that the appellant made a concession of the nature described by her. Indeed, when the appellant was confronted with the suggestion that he had lost time from work in 1986 as a result of a back condition, he denied all knowledge of it and said that he did not recall any such event. URJ CROUCH v WYONG SHIRE COUNCIL (Clarke JA) 3 Counsel also relied on her Honour's next statement and said, far from the evidence being silent regarding the pre-accident condition of the appellant's back, there was plenty of evidence about it and that the significant fact was that, despite the undoubted fact that he had a degenerative back, there was no supportable suggestion he had ever had problems with it prior to February, 1988 sufficient to put him off work for a sufficient period. There were, counsel suggests, two points of complaint about the first major paragraph in the substantive reasoning. One was a clear mistake and the other was indicative of a misunderstanding of the evidence. Mistakes or misunderstandings of the nature described by counsel may, or may not, matter inthe consideration of the adequacy of a judge's exposed reasoning process. Where shortfalls clearly demonstrate that the trial judge has understood the evidence, or the totality of the evidence, properly and has exposed the reasons which lead him or her to prefer one version of the evidence to another earlier mistakes may be regarded as irrelevant. Where, however, the reasoning process is meagre, to put it at its highest, mistakes take on another aspect. In this case her Honour has simply said that she is not persuaded that the sequelae of an injury which occurred to the appellant's back in February, 1988 persisted. Why her Honour was not persuaded is to be found in the earlier paragraphs and, as I have pointed out, the only significant earlier paragraph contains two statements which fail to support the conclusion that she reached. The case under examination was a familiar one in the Compensation Court. A person in his fifties with a spine which was exposed as degenerative under radiological examination, claimed that he had performed heavy work for many years and that he had sustained an incident at work and that thereafter he was unfit for heavy work. His evidence, after cross-examination, stood although it is fair to say, as counsel for the respondent has said, that there were aspects of it which may have been criticised. The medical evidence was, as is usually the case, in conflict. On one side was the evidence of doctors called on behalf of the appellant who said that he was still suffering and would continue to suffer the effects of the aggravation to his degenerative spine which occurred in February, 1988. On the other side was the evidence of doctors who said that the aggravation had settled down within a few weeks. There was also the evidence of Dr Allport, to whom the respondent had referred the appellant, who said the appellant seemed to have recovered to his pre-injury state by March, 1988. This provided material, whether regarded in isolation or together with the other evidence called by the respondent, which could have supported her Honour's conclusions. There were, however, some features of Dr Allport's expressions of opinion which were troubling such as the recommendation that theappellant should continue to have regular physiotherapy and should not engage in lifting, other than light objects, or bending. The suggestion that he had recovered to his pre-injury state is somewhat hard to accept when one has in mind what he did prior to the accident, and what he was advised to do in March, 1988. Nonetheless the evidence was there and could have been accepted by her Honour. Unfortunately she has failed to point out what it was that led her to her conclusion, or even to indicate the course of her reasoning. The judicial obligation to furnish reasons for conclusions is expressed in many cases most of which go back to Soulemezis v Dudley (Holdings) Limited (1987) 10 NSWLR 247. I will refer to the short statement by McHugh JA at page 280 where he said: 4 UNREPORTED JUDGMENTS It is necessary that the essential ground or grounds upon which a decision rests should be articulated. In many cases the reasons for preferring one conclusion to another also need to be given. And as Mahoney JA said in the same case in a passage from page 271-273: The reasons should be sufficient to enable the parties to know the broad course of the trial judge's reasoning in leading to a conclusion. Judge O'Toole's judgment, unfortunately, does not pass the test imposed by those statements. Nowhere is it clear from her reasons why she reached her conclusion. Further, the inadequacy in the expression of the reasoning process is compounded by the fact that the material to which she made specific reference was, at worst, wrong and, at best, somewhat dubious. In the circumstances it will be necessary for the award to be set aside and for the proceedings to be remitted for retrial. I would propose that the following orders be made: That the appeal be allowed. That the award be set aside. That proceedings be remitted to the Compensation Court for re-hearing. That the costs of the first hearing be in the discretion of the judge whoconducts the re-hearing. 5. Respondent to pay the appellant's costs of the appeal and is, if otherwise qualified, to have a certificate under the Suitors Fund Act in respect of those costs. Cole JA. I agree. Hunter AJA. I agree. RYNP (1) That the appeal be allowed. (2) That the award be set aside. (3) That proceedings be remitted to the Compensation Court for re-hearing. (4) That the costs of the first hearing be in the discretion of the judge who conducts the re-hearing. (5) The respondent to pay the appellant's costs of the appeal and is, if otherwise qualified, to have a certificate under the Suitors Fund Act in respect of those costs. Counsel for the appellant: B G Mc MANAMEY Solicitors for the appellant: STACKS: Taree Counsel for the respondent: C R R HOEBEN SC Solicitors for the respondent: PIETERSE and PIETERSE