New South Wales Court of Appeal CITATION: State of New South Wales v Landini [2010] NSWCA 157 HEARING DATE(S): 23 April 2010 JUDGMENT DATE: 9 July 2010 JUDGMENT OF: Tobias JA at 1; Macfarlan JA at 2; Sackville AJA at 119 (1) Appeal allowed in part; (2) Leave granted to the respondent to file a Notice of Cross Appeal in the form provided to the Court on the hearing of the appeal; (3) Cross appeal allowed; DECISION: (4) Set aside orders (1) – (5) made by Hall J on 22 May 2009 in respect of the 1980 Charge; (5) In lieu of the orders set aside, enter judgment for the respondent against the appellant in the sum of $60,000, comprised of $10,000 aggravated damages and $50,000 exemplary damages; (6) Order that the appellant pay interest on the amount of $10,000 in respect of aggravated damages from 2 November 2001 until the date of this judgment at the rates prescribed in Schedule 5 of the Uniform Civil Procedure Rules; (7) Order that the appellant pay 50 per cent of the respondent's costs of the appeal and cross appeal; and (8) The respondent to have a certificate under the Suitors' Fund Act 1951, if qualified. CATCHWORDS: TORTS - malicious prosecution - whether police officers maintained the prosecution of the respondent - whether the officers took active steps to support the prosecution - TORTS - malicious prosecution - whether State of New South Wales vicariously liable by reason of the Law Reform (Vicarious Liability) Act 1983 - whether the torts found by the primary judge were ones "arising out of a wrongful act or omission" occurring prior to the date appointed and notified under s 2(2) of that Act - TORTS - malicious prosecution - award of exemplary damages LEGISLATION CITED: Law Reform (Vicarious Liability) Act 1983 Poisons Act 1966 CATEGORY: Principal judgment A v New South Wales [2007] HCA 10; (2007) 230 CLR 500 Adams v Kennedy [2000] NSWCA 152; (2000) 49 NSWLR 78 Coleman v Buckingham's Ltd (1963) 63 SR (NSW) 171 Daniels v Telfer (1933) 34 SR (NSW) 99 Davis v Gell [1924] HCA 56; (1924) 35 CLR 275 DPP v Arab [2009] NSWCA 75 Enever v The King [1906] HCA 3; (1906) 3 CLR 969 CASES CITED: Fitzjohn v Mackinder (1861) 9 CB (NS) 505; (1861) 142 ER 199 Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 Lamb v Cotogno [1987] HCA 47; (1987) 164 CLR 1 Martin v Watson [1996] AC 74 New South Wales v Ibbett [2006] HCA 57; (2006) 229 CLR 638 R v Butler (1991) 24 NSWLR 66 Smith v Commonwealth Life Assurance Society Ltd (1935) 35 SR (NSW) 552 XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; (1984-1985) 155 CLR 448 TEXTS CITED: John G Fleming, The Law of Torts, 9th ed (1998) LBC Information Services PARTIES: State of New South Wales (Appellant) Henry Charles Landini (Respondent) FILE NUMBER(S): CA 2009/298180 COUNSEL: J Maconachie QC/ P D Mallon (Appellant) C Steirn SC/P Strain/P Barham (Respondent) SOLICITORS: Crown Solicitor (Appellant) Burn and Company (Respondent) LOWER COURT JURISDICTION: Supreme Court - Common Law Division LOWER COURT FILE NUMBER(S): 20525/02 LOWER COURT JUDICIAL OFFICER: Hall J LOWER COURT DATE OF DECISION: 17 December 2008 LOWER COURT MEDIUM NEUTRAL CITATION: Landini v State of New South Wales & Ors [2008] NSWSC 1280 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 2009/298180 TOBIAS JA MACFARLAN JA SACKVILLE AJA 9 JULY 2010 STATE OF NEW SOUTH WALES v LANDINI Judgment 1 TOBIAS JA: I agree with Macfarlan JA. 2 MACFARLAN JA: Nature of case and conclusions 3 The respondent was arrested in January 1980 and charged with an offence of supplying a prohibited drug, namely heroin. After pleading guilty to this charge he was sentenced in June 1984 to a term of 15 years' imprisonment. 4 Subsequently one of the police officers involved in the respondent's arrest gave evidence to the Royal Commission into the New South Wales Police Service ("the Wood Royal Commission") that the evidence in support of the charge against the respondent had been fabricated. This led to the New South Wales Court of Criminal Appeal setting aside the respondent's conviction. 5 Thereafter the respondent commenced the present proceedings claiming damages for malicious prosecution. The proceedings were brought against the appellant on the basis that it was vicariously liable for the conduct of the police officers involved in the respondent's arrest and subsequent prosecution. The proceedings were also brought in relation to the prosecution of the respondent on other charges and against other defendants but those aspects of the proceedings are not relevant to this appeal. 6 The primary judge held that the appellant was vicariously liable for the conduct of the relevant police officers, but only in respect of the period after 28 October 1983, which was the date of commencement of the Law Reform (Vicarious Liability) Act 1983 ("the Vicarious Liability Act"). He found that the respondent had established his malicious prosecution claim insofar as it related to that period and awarded him damages totalling $230,000. 7 In summary my conclusions are as follows: (a) Two police officers, namely Mr Ross and Mr Knox, took active steps after 28 October 1983 to maintain the prosecution of the respondent in relation to the heroin allegedly found in his possession in January 1980; (b) There is no basis for this Court interfering with the primary judge's conclusion that this heroin was planted by police in the respondent's vehicle in January 1980 and that Mr Ross and Mr Knox were knowingly involved in that conduct; (c) Those officers thus knew that the prosecution of the respondent was without foundation. Accordingly when they took active steps to maintain that prosecution after 28 October 1983 they did so maliciously and without reasonable and probable cause; (d) The Vicarious Liability Act rendered the appellant vicariously liable for the tortious acts of Mr Ross and Mr Knox committed after 28 October 1983; and (d) The damages of $230,000 awarded by the primary judge should be reduced to $60,000, comprised of $10,000 aggravated damages and $50,000 exemplary damages. Factual circumstances 8 In 1980 the respondent lived in Leonay near Penrith. He gave evidence in these proceedings that during the afternoon of 15 January 1980 he left his home in his car, drove onto the F4 Freeway and headed towards Sydney. On this freeway he was stopped by police officers who opened the boot of his car and claimed to find in it plastic bags containing white powder which was subsequently identified as heroin. The police officers accompanied him back to his home where they claimed that they found drugs in another of the respondent's cars and in his bedroom. 9 The respondent denied any knowledge of the heroin and other drugs. He was however charged under s 32(1)(a) of the Poisons Act 1966 with the supply of a prohibited drug, namely the heroin allegedly found in the boot of his vehicle on the freeway ("the 1980 Charge"). Reliance was placed in the Charge Sheet upon s 45A(4) of that Act which deemed a person who was found in possession of more than a prescribed quantity of a prescribed drug to be in possession for the purpose of supply of such a drug unless, relevantly, that person proved otherwise. 10 The foundation for the respondent's present proceedings for malicious prosecution is the evidence given by Mr Trevor Haken who in 1980 was a detective senior constable of the New South Wales Police Force and attached to the New South Wales Drug Squad. The evidence he gave in these proceedings and to the Wood Royal Commission was to the following effect. He said that shortly prior to 15 January 1980 he was approached by Detective Senior Constable Glen Ross who said that "he [Mr Ross] was intending to lock up Henry Landini with other police and asked me whether I was willing to be a party to locking Mr Landini up or whether I would rather not join in" (quoted in the Judgment at first instance at [203]). Mr Haken said that Mr Ross told him that "he [Mr Ross] had a quantity of heroin and that Mr Landini was going to be loaded up and charged" and that Mr Haken "was given the task of cutting the heroin, that is, diluting it into a larger quantity and placing it into small plastic bags to give the effect of being bagged heroin" (ibid). Mr Haken also said that the "methodology discussed in a number of conversations with all six police officers involved" was "that we were to drive to an area close to Landini's home, in Leonay, I think, and wait for him to leave his home and drive on to the expressway where he would be stopped and he would be found to be in possession of the quantities of heroin" (quoted in the Judgment at first instance at [206]). The six officers to whom Mr Haken referred were Detective Sergeant Knox, Detective Senior Constables Ross, Leary, Chidgey and Gardiner and himself. Although he did not identify which officer placed the heroin in the boot of the respondent's vehicle whilst it was on the freeway, his evidence was to the effect that the plan was carried out. 11 The respondent was taken into custody on that day but was released on bail on 16 January 1980. After a two day committal hearing in April 1981 he was committed to the Sydney District Court for trial, with bail to continue. 12 In July 1982 the respondent was arrested and charged with certain unrelated offences ("the 1982 Charges"). He was found guilty of those offences in October 1983 and was sentenced to a term of imprisonment of 16 years with a non-parole period of 6 years. The term of imprisonment was specified to commence on 19 July 1982, the date on which he had been taken into custody. 13 In late 1982 an application was made for a "no bill" in respect of the 1980 Charge. It was rejected in early 1983. Thereafter the 1980 Charge proceedings were mentioned in the District Court on a number of occasions prior to 28 October 1983. 14 On 28 October 1983 the substantive provisions of the Vicarious Liability Act came into force. 15 On 31 October 1983 the 1980 Charge proceedings were mentioned and listed for trial that was to take place on 19 March 1984. On that date the respondent pleaded guilty to the charge. On 7 June 1984 he was sentenced on that charge to a term of imprisonment of 15 years to date from 19 July 1982, concurrent with the sentence imposed in relation to the 1982 Charges. The sentence specified a non-parole period of four years, expiring on 18 July 1988. 16 The respondent was released on parole on 12 August 1987, having served 5 years and 25 days' imprisonment. 17 On 21 August 1995 Mr Haken gave evidence to the Wood Royal Commission of the fabrication of the evidence relied upon by the prosecution in relation to the 1980 Charge. This led to the Court of Criminal Appeal setting aside the respondent's conviction on that charge on 2 November 2001. His convictions on the 1982 Charges were also set aside. In each case a verdict of acquittal was entered. 18 On 20 November 2002 the respondent commenced the present proceedings for malicious prosecution in relation to both the 1980 Charge and the 1982 Charges. The primary judge ultimately rejected his claim in respect of the 1982 Charges and no appeal is brought from that decision. The elements of the tort of malicious prosecution 19 The elements of the tort of malicious prosecution were summarised in the joint judgment of six members of the High Court in A v New South Wales [2007] HCA 10; (2007) 230 CLR 500 as follows: "[1] … (1) that proceedings of the kind to which the tort applies (generally, as in this case, criminal proceedings) were initiated against the plaintiff by the defendant; (2) that the proceedings terminated in favour of the plaintiff; (3) that the defendant, in initiating or maintaining the proceedings acted maliciously; and (4) that the defendant acted without reasonable and probable cause" (citation omitted) (at [1]). 20 To these elements should be added proof of damage, as malicious prosecution is an action on the case (Davis v Gell [1924] HCA 56; (1924) 35 CLR 275 at 284, 285 per Isaacs ACJ and Smith v Commonwealth Life Assurance Society Ltd (1935) 35 SR (NSW) 552 at 557 per Jordan CJ with whom Halse Rogers and Street JJ concurred). 21 The parties to the present proceedings accepted that the first element to which the joint judgment in A v New South Wales referred could be satisfied by the maintenance as distinct from the initiation of proceedings. 22 The appellant did not plead or contend at the trial that the respondent's action was statute barred. The appellant appears to have accepted that, since the respondent had to prove that the criminal prosecution terminated in his favour, his cause of action did not accrue until the verdict of acquittal was entered in 2001. The Law Reform (Vicarious Liability) Act 23 In broad terms this Act renders the Crown vicariously liable for torts committed by its servants in the performance of their duties, notwithstanding that they may have been performing "an independent function" that under the common law was a circumstance that would have precluded the Crown from being vicariously liable. At common law the Crown was not vicariously liable in respect of any torts arising out of the exercise of the independent discretion of a police officer, on the ground that the police officer was in such a circumstance not exercising a delegated authority but an original authority (see for example Enever v The King [1906] HCA 3; (1906) 3 CLR 969). 24 Save for raising an issue as to the operation of s 3 of the Vicarious Liability Act (see [47] – [50] below), the appellant did not contend that it was not liable for such torts as might be proved in the proceedings to have been committed after 28 October 1983 by the police officers against whom relevant allegations were made. 25 Section 3 of the Vicarious Liability Act is in the following terms: "3. This Act does not apply to or in respect of a tort committed by a person or arising out of a wrongful act or omission occurring before the day appointed and notified under s 2(2)". 26 The date referred to in s 3 became 28 October 1983. The Judgment at first instance Acts of prosecution after 28 October 1983 27 The primary judge concluded that the appellant did not in the present case have any vicarious liability except to the extent that it arose by reason of the Vicarious Liability Act. Bearing in mind the terms of s 3 of that Act and the date of 28 October 1983 to which it came to refer (see [25] – [26] above), his Honour then turned to address the appellant's contention that "there were no active steps by way of prosecution that occurred after 28 October 1983 that could make it vicariously liable under the Vicarious Liability Act" (Judgment [114]). 28 There was no oral evidence of any significance about any steps taken in connection with the prosecution of the 1980 Charge after 28 October 1983. The documentary evidence comprised entries in the records of the District Court. The judge summarised those entries as follows: "(e) 31 October 1983: the hearing was vacated. A note 'possibly plea?' . Remanded for trial on 19 March 1984. Detective Knox was present. (f) 19 March 1984: plea of guilty entered. Facts and antecedents tendered. Noted that 'all police present' . (g) 29 March 1984: stood over (h) 7 June 1984: sentence – a term of imprisonment of 15 years to date from 19 July [1982] concurrent with existing sentence. Non-parole period to expire on 18 July 1988. Noted Detective Sergeant Knox present" (Judgment [123(7)]). 29 His Honour then noted that liability for malicious prosecution may arise either from the institution of proceedings or from the maintenance of proceedings (Judgment [139]) and continued: " … The maintenance of proceedings would, in my opinion, include all acts by 'the prosecutor' after October 1983 in maintaining and pursuing the proceedings including the re-listing of them for ultimate hearing and disposal by conviction and sentence" (Judgment [141]). 30 The judge referred to the decisions in Fitzjohn v Mackinder (1861) 9 CB (NS) 505; (1861) 142 ER 199, Daniels v Telfer (1933) 34 SR (NSW) 99 and Coleman v Buckingham's Ltd (1963) 63 SR (NSW) 171 and continued: "149 … In the event that findings were made that police fabricated the evidence leading to the plaintiff's arrest on 15 January 1980, then any and all steps taken after October 1983 to maintain or continue the proceedings using such tainted evidence would plainly be taken ' malo animo ' ['with evil intent']. A finding to that effect would necessarily imply that the police officer or officers, as prosecutor(s), though knowing the true position, suppressed their knowledge of the true facts thereby falling within that category of case referred to by Harvey ACJ in Daniels (supra). 150 If it be that the prosecution for the 1980 charge was based on fabricated evidence, the prosecutor(s) responsible for its manufacture would be under a duty to disclose it. Suppression of the truth where a duty exists to disclose false information is ' conduct ' in the maintenance of proceedings as is a specific step taken in pursuing them. Similar concepts arise in other areas of the law. Failure to provide information in trade practices law (s.52, Trade Practices Act 1974 (Cth)) can be actionable as misleading and deceptive conduct. See for example Costa Vraca Pty Limited v Berrigan Weed & Pest Control Pty Limited (1988) 155 ALR 714 per Finkelstein J at 722. 151 If a finding were to be made that police ' loaded ' the plaintiff with heroin and then charged him on the basis of such fabricated evidence (a matter considered below), the police officer or officers responsible, as prosecutor(s), would thereafter be subject to a duty to disclose his/their wrongdoing and not allow the prosecution to go forward based on manufactured evidence. On such a finding in this case, by pursuing the proceedings including attending court from time to time up to sentence, they would be maintaining a prosecution with respect to the 1980 charge prior to and beyond 28 October 1983". The evidence of Mr Haken 31 The primary judge then considered whether the evidence in relation to the 1980 Charge had been fabricated. His Honour's conclusion on this issue turned upon his preference for the evidence of Mr Haken over the evidence of the four police officers whom the appellant called to give evidence. Of the six police officers referred to in [10] above, only Mr Knox did not give evidence. His absence from the witness box was explained as being for medical reasons. His Honour's task in forming a view as to the credit of Mr Haken and the other officers who gave evidence was an onerous one in light of the fact that this was the central factual issue in a very lengthy trial. 32 The judge reviewed the respondent's evidence and said that in light of the respondent's past history, which included involvement in acts of dishonesty, caution was to be exercised in evaluating his evidence. He said that he would not rely upon the respondent's evidence as to what occurred on 15 January 1980 "unless and to the extent that it is corroborated by other evidence" (Judgment [171]). 33 The judge then summarised the evidence that Mr Haken gave in the proceedings and to the Wood Royal Commission. His Honour made the following concluding observations: "267 In these proceedings, [Mr Haken] gave evidence by video link from a remote location. That too is to be taken into account for it can impact on the ability to assess a witness in those circumstances as against one who is present in the court room. That said, there was nothing that I noted that made it difficult to see or hear Mr Haken on the occasions he gave evidence. 268 The assessment I made of him was a favourable one. On several occasions, he emphasised the limitations on the extent of his recollection and did so in a manner that clearly conveyed that he was not prepared to go further than his recollection permitted. In that respect and generally, he conveyed an impression of objectivity and appeared to give evidence in a reasonably measured and reasonable fashion and without any signs of embellishment or partiality to the plaintiff or any form of animus towards his former colleagues". 34 The judge then reviewed the evidence of the four former police officers called as witnesses by the appellant, namely, Messrs Ross, Leary, Gardiner and Chidgey (Judgment [271] – [375]) and the submissions of the parties (Judgment [376] – [424]). He commented on how the evidence should be evaluated (Judgment [425] – [435]) and referred to case authorities relevant to the task upon which he was engaged (Judgment [436] – [445]). 35 His Honour then considered a variety of circumstances relevant to the issues of credit which he had to determine, ultimately reaching the conclusion that the evidence of Mr Haken concerning the evidence in support of the 1980 Charge should be accepted in preference to that of the other former police officers who gave evidence (Judgment [446] – [477]). However, whilst finding that Mr Ross and Mr Knox were involved in the fabrication of the evidence in relation to the 1980 Charge, his Honour said that he was not satisfied that Mr Gardiner, Mr Chidgey and Mr Leary were involved in the fabrication and that he would not make any adverse findings against them (Judgment [472] – [473]). Conclusions on liability 36 The effect of the judge's conclusions was that Mr Ross and Mr Knox committed the tort of malicious prosecution after the date of commencement of the Vicarious Liability Act, that is, 28 October 1983. He found that their actions after that date constituted the maintenance of the prosecution of the respondent in relation to the 1980 Charge. By reason of the Vicarious Liability Act the appellant was vicariously liable in respect of that conduct. 37 The parties conducted the proceedings below upon the basis that if his Honour accepted the evidence of Mr Haken that the evidence in support of the 1980 Charge had been fabricated, it followed that the respondent had established the existence after 28 October 1983 of the necessary elements of malice and absence of reasonable and probable cause on the part of the two officers who were involved both in the fabrication of evidence and in the maintenance of the prosecution of the respondent after that date (see A v New South Wales at [1]). 38 Subject to the proof of damage, these conclusions established the liability of the appellant for the tort of malicious prosecution. Damages 39 The primary judge then turned to consider damages. 40 First he concluded that the respondent's claim in respect of damage to his reputation failed. No appeal is brought in respect of that finding. 41 Secondly he awarded the respondent damages of $5,000 in respect of economic loss. This award related to the respondent's claim for the cost to him of legal representation at his committal proceedings (Judgment [505]). Those proceedings concluded on 3 April 1981, that is, well before the date of commencement of the Vicarious Liability Act. Although his Honour mentions listing dates after 28 October 1983 in his discussion of the economic loss claim (Judgment [503]), it appears that the respondent's claim, and his Honour's award of $5,000, related only to the committal proceedings. 42 His Honour then awarded the respondent $35,000 to compensate him for "damage by deprivation of liberty" (Judgment [506] – [513]). This award related to the risk that existed for the period that the respondent was on bail, that is, from 16 January 1980 to 19 July 1982, that he might be convicted on the 1980 Charge and imprisoned as a consequence. The latter date was the date upon which he was arrested in respect of the 1982 charges. The judge's award was thus confined to a period concluding prior to the commencement of the Vicarious Liability Act. 43 The judge then awarded the respondent the amount of $30,000 by way of aggravated damages in respect of mental distress suffered by him (Judgment [525]). It is apparent from his Honour's reasons that the award was overwhelmingly related to distress that the respondent suffered as a result of the events which occurred prior to the commencement of the Vicarious Liability Act on 28 October 1983. It seems however from the passage of his judgment quoted below (that is, [524]) that some element, albeit small, related to the period after that date. The judge referred to the "mental distress and agitation" that the respondent would have suffered as a result of his arrest and detention, the search of his home, his "ongoing attempt" to establish his innocence and his appearance at the committal proceedings on 2 and 3 April 1981 (Judgment [514] - [516]). His Honour continued as follows: "524 During the period 3 April 1981 to 7 June 1984, the prosecution, having been stood over until the 1982 prosecution concluded in December 1983, a period of approximately three years and two months, the plaintiff had the proceedings for the 1980 charge hanging over his head. I accept that the stress and uncertainty of being wrongly accused would have been operating for a period but that it would have reduced over a two year period 1980 and 1981 and certainly before his involvement in the 1982 conspiracy". I read this passage as concluding that the stress and uncertainty to which his Honour referred would "certainly" have reduced before the respondent's "involvement in the 1982 conspiracy" and not as concluding that this stress and uncertainty would have disappeared altogether by that time. This is made clear by the judge's reference at the commencement of the passage to a period concluding on 7 June 1984. This was the date that the respondent was sentenced on the 1980 Charge. 44 Finally, the amount of $160,000 was awarded as exemplary damages (Judgment [535]). His Honour's reasoning appears to relate the award solely to the events of January 1980 (see for example the references in Judgment [526] – [528] to the "fabrication or manufacture of evidence", to "[t]he conduct in the present case … [involving] careful planning and execution" and to "orchestrating the basis for criminal proceedings by fabricating evidence"). These events occurred prior to the commencement of the Vicarious Liability Act. 45 The total of the damages awarded on these various bases was $230,000 (Judgment [536]). Issues on appeal 46 The appellant made the following challenges to the Judgment below. First it submitted that the Vicarious Liability Act did not render the appellant vicariously liable in respect of any of the conduct of the police officers involved in the arrest and prosecution of the respondent. Secondly it challenged the judge's findings that after the date of commencement of the Vicarious Liability Act there were acts of prosecution on the part of Mr Ross and Mr Knox. Thirdly it challenged the primary judge's acceptance of the evidence of Mr Haken. Fourthly it challenged the damages awards that his Honour made. I shall deal with each of these in turn. The operation of s 3 of the Vicarious Liability Act 47 The appellant submitted that s 3 of the Vicarious Liability Act (see [25] above) had the effect in the present case of rendering the Act inapplicable not only to acts of prosecution of Mr Ross or Mr Knox that occurred prior to 28 October 1983, but also to any such acts that occurred after that date. It submitted that this followed from the fact that s 3 provided that the Act was inapplicable to a tort "arising out of a wrongful act or omission occurring before [28 October 1983]". Its submission was that although the tortious conduct found by the primary judge was based upon acts of prosecution that occurred after 28 October 1983, that conduct "arose out of" (a cognate expression of the statutory phrase "arising out of") the fabrication on 15 January 1980 of the evidence founding the 1980 Charge. The appellant submitted that this fabrication of evidence was a relevant "wrongful act or omission" and s 3 resulted in the appellant not being vicariously liable for the tortious conduct of Mr Ross and Mr Knox. 48 It is true that it might be said that in a broad sense what occurred after 28 October 1983 "arose out of" the wrongful conduct that occurred on 15 January 1980. However s 3 is in my view concerned, first, with torts committed in their entirety prior to the relevant date and, secondly, with acts or omissions occurring prior to that date upon which a plaintiff relies as constituting essential ingredients of a tort. On this approach the second limb of the section (that is, that concerned with torts "arising out of a wrongful act or omission") has a distinct operation from that of the first limb. This is because essential ingredients of a tort may occur prior to 28 October 1983 but the tort may not be complete until after that date. For example in the case of the tort of malicious prosecution, the essential ingredient of termination in favour of the plaintiff of the maliciously prosecuted proceedings may not have occurred until after 28 October 1983. It is understandable that the legislature may have wished to preclude the Vicarious Liability Act from applying, and thereby making an employer vicariously liable, in such circumstances because essential ingredients of the tort would have occurred before the commencement of the Vicarious Liability Act. 49 Taken in the context in which they appear, the words "arising out of" clearly refer to a direct and immediate relationship between the tort alleged and the relevant wrongful acts or omissions. It would achieve no evident policy purpose to construe the words of s 3 as applying to acts or omissions that need not be proved to establish commission of the tort. Consequently the fact that the acts of malicious prosecution alleged to have occurred after 28 October 1983 were related to the events of January 1980 does not mean that s 3 of the Vicarious Liability Act prevents the respondent from relying on the later (post-October 1983) acts as part of the essential ingredients of the tort found to have been committed. In the context of this case these essential ingredients are the acts of prosecution committed after 28 October 1983 maliciously and without reasonable and probable cause, the respondent's acquittal in 2001 on the 1980 Charge and the suffering of damage. The essential ingredients do not include the fabrication of evidence that occurred on 15 January 1980 although of course that event has evidentiary significance in the proof of the state of the "prosecutors'" minds after 28 October 1983. 50 As a result s 3 does not render the Vicarious Liability Act inapplicable to the torts that I find below to have been committed after 28 October 1983. Maintenance of prosecution after 28 October 1983 Appellant's Submissions 51 In reliance upon Daniels v Telfer and Coleman v Buckingham's Ltd (see [30] above) the appellant submitted that "[r]efraining from taking any steps or 'mere abstinence from doing anything' is insufficient to support a claim for malicious prosecution" (Written Submissions [19]). It submitted that there was no evidence of Mr Ross or Mr Knox "having actively prevented the giving of evidence by persons who [were] qualified so to do, having suppressed evidence or otherwise having done something. At its highest there was a failure to do something. That is insufficient to attract liability, if only because it denies the application of the rule which requires a coalescence of malice [and] absence of reasonable and probable cause, with an identifiable event or act in prosecuting the plaintiff" (Written Submissions [20(d)]). It submitted that on and after 28 October 1983, the relevant police officers were not "prosecutors – at best they were witnesses or potential witnesses" (Written Submissions [21]) and that where, as here, a Crown Prosecutor was commissioned to conduct the proceedings, the Crown Prosecutor "has charge of the prosecution and is responsible for it" (Written Submissions [20(c)]). In this context, it referred to R v Butler (1991) 24 NSWLR 66 (ibid). Authorities as to the maintenance of a prosecution 52 To deal with these submissions, it is necessary to refer to authorities relating to the acts which are capable of constituting the maintenance of a prosecution for the purposes of the tort of malicious prosecution. 53 In Daniels v Telfer the plaintiff alleged that shortly after the defendants procured the issue of a warrant for the arrest of the plaintiff on a charge of larceny, the defendants became aware that the plaintiff was innocent of that charge. The plaintiff's Declaration filed in those proceedings alleged that the defendants "falsely and maliciously and without reasonable and probable cause refrained from taking any steps to prevent the execution of the said warrant and to prevent the plaintiff from being arrested thereunder" (Daniels v Telfer at 99). On demurrer, the Court held that the Declaration was defective as it did not allege that the defendants maliciously took any active step to continue the prosecution. 54 Harvey ACJ made the following observations: "In my opinion malicious prosecution connotes an active prosecution of the plaintiff. It must be shown that at some time when the defendants took some steps towards pressing on the prosecution they were actuated by malice. Mere saying nothing, taking no part in pressing on the execution, in my opinion is no breach of any duty which the defendants owed to the plaintiff. They must at the time when they do something by way of prosecution of the defendant be actuated by malice and without reasonable or probable cause. All that is alleged here is that after the warrant had been properly issued they refrained from taking steps to withdraw the warrant. In my opinion that gives no cause of action. Had they taken any steps such as by way of giving evidence in support of the prosecution, had they actively prevented the giving of evidence by persons who were qualified to give evidence, had they suppressed evidence, then I think on the authorities on the cases which have been cited to us, particularly the case of Fitzjohn v [Mackinder] (8 C.B. (N.S.) 592 and 9 C.B. (N.S.) 505)[,] I think the Court is justified in saying that they took an active step actuated by malice without reasonable and probable cause sufficient to establish malicious prosecution; but mere abstaining from doing or taking any action at all is not, in my opinion, malicious prosecution" (at 102). 55 James and Halse Rogers JJ concurred. Halse Rogers J added the following observation: "The only matter that has caused me any doubt is that in the course of the history the pleader alleges that the defendants procured a further adjournment of the hearing. That in itself of course was an active step and in my opinion in a declaration properly framed, if the plaintiff declared that after the arrest the defendants knowing of the innocence of the plaintiff maliciously and without reasonable and probable cause suppressed from the magistrate their knowledge of the innocence of the plaintiff and procured an adjournment and caused damage to the plaintiff, in my opinion that would give them ground for action …" (at 103). 56 In Fitzjohn v Mackinder, a decision of the Court of Exchequer Chamber referred to by Harvey ACJ, the defendant gave false evidence in civil proceedings that the plaintiff had signed an acknowledgement. The plaintiff denied that the signature was his, but he was disbelieved by the County Court judge who determined the civil claim. The judge, on his own motion, bound the defendant over to prosecute the plaintiff for perjury. This the defendant did by preferring a bill of indictment, but the plaintiff was ultimately acquitted. 57 The plaintiff was non-suited in his subsequent action against the defendant for malicious prosecution, but he succeeded in obtaining a verdict on appeal (Cockburn CJ, Bramwell and Channell BB agreeing, Blackburn and Wightman JJ dissenting). Cockburn CJ, with whom Channell B concurred, said this (9 CB (NS) 505 at 531; 142 ER 199 at 210): "In my opinion … a prosecution, though in the outset not malicious, as having been undertaken at the dictation of a judge or a magistrate, or, if spontaneously undertaken, from having been commenced under a bona fide relief in the guilt of the accused, may nevertheless become malicious in any of the stages through which it has to pass, if the prosecutor, having acquired positive knowledge of the innocence of the accused, perseveres malo animo in the prosecution, with the intention of procuring per nefas a conviction of the accused. Take, for instance, the case of a prosecutor, who, after the commitment of a prisoner, and before going before the grand jury, chanced to discover the clearest proof of the prisoner's innocence, and yet went on with the indictment and prosecution, suppressing the newly-ascertained facts, and supporting the case against the prisoner by evidence either absolutely false or rendered so by the suppression of facts which would have shewn the innocence of the accused. Can it be said that to prefer an indictment under such circumstances, to be followed up by such a course of proceeding as I have referred to, would not be a malicious prosecution, for which the man whose life or liberty had been put in peril by it should have a remedy by civil action?". 58 Daniels v Telfer was followed in Coleman v Buckingham's Ltd where it was held that allegations that the plaintiff had maliciously and without reasonable and probable cause continued the prosecution of a civil proceeding by taking certain identified steps were capable of establishing the commission of the tort. The steps alleged to have been taken comprised the procuring of an order to proceed, and of a judgment, "by falsely and maliciously representing to the court by a false affidavit certain facts" (at 178). 59 The joint judgment in A v New South Wales pointed out that "[t]he identification of the appropriate defendant in a case of malicious prosecution is not always straightforward. 'To incur liability, the defendant must play an active role in the conduct of the proceedings, as by 'instigating' or setting them in motion'" (at [34] citing John G Fleming, The Law of Torts, 9th ed (1998) LBC Information Services at p 676). Their Honours continued: "[35] In Martin v Watson ([1996] AC 74), a woman made an allegation that her neighbour had indecently exposed himself to her whilst standing on a ladder in his garden. She went to a police station and complained. A detective constable laid an information against the neighbour. At a hearing before the Magistrates' Court, the Crown Prosecution Service offered no evidence, and the charge was dismissed. The House of Lords held that, since the facts relating to the alleged offence were solely within the complainant's knowledge, and that as a practical matter the police officer who laid the information could not have exercised any independent discretion, the complainant could be sued for malicious prosecution, and upheld an award of damages against her. The complainant had 'in substance procured the prosecution' ([1996] AC 74 at 89). The police officer to whom the complaint was made had no way of testing the truthfulness of the accusation ([1996] AC 74 at 89). Lord Keith of Kinkel quoted with approval a statement by McMullin J in the Court of Appeal of New Zealand ( Commercial Union Assurance Co of New Zealand Ltd v Lamont [1989] 3 NZLR 187 at 207-208), that a person may be regarded as the prosecutor if he puts the police in possession of information which virtually compels an officer to bring a charge". 60 With the principles enunciated in these cases in mind, I turn to the evidence of what occurred after 28 October 1983 in the prosecution of the respondent. It is convenient to refer first to what occurred on 19 March 1984. The hearing on 19 March 1984 61 As is apparent from [28] above the respondent's trial was fixed to commence on 19 March 1984 but, instead, a plea of guilty was entered on that day and a "Facts and Antecedents" document was tendered in the presence of "[a]ll police". The District Court record upon which the primary judge based his conclusions also indicates that on that day Mr C Armitage appeared as Crown Prosecutor, that Mr Conomos appeared "as amicus curiae for [the] accused in custody", that after the "Facts and Antecedents" document was tendered, Mr Conomos addressed the Court and that the Court's decision on sentencing was reserved until 20 March 1984, with the respondent remaining in custody in the meantime (he having been convicted of the 1982 charges in October 1983). 62 A document that can readily be inferred to be a copy of a document prepared by Mr Knox and to be a copy of the "Facts and Antecedents" document handed to the Court on 19 March 1984 was in evidence before the primary judge. It was headed "FACTS IN RELATION TO HENRY CHARLES LANDINI CHARGED SUPPLY HEROIN". It commenced with the words "Your Honour" and concluded with the name in typescript of Mr Knox and the description of him as "Detective Sergeant 3rd class". The document described the respondent's arrest and asserted that he had been found in possession of heroin, whereas the police had in fact planted the heroin in the respondent's vehicle. 63 The appellant contended that this Court could draw no inference that this document was prepared after 28 October 1983. I do not agree. The District Court's records that were in evidence show that on 14 October 1983 the respondent's trial was fixed to commence on 31 October 1983. On that latter date the trial was adjourned to 19 March 1984, with the notation "Possibly Plea?" appearing on the records. The "Facts and Antecedents" document is one appropriate for submission to a court where a plea of guilty is to be entered, but has no apparent utility where a trial is to occur following a plea of not guilty. Accordingly, this Court should draw the inference that the document was prepared at some stage after the indication was given to the Court on 31 October 1983 that the respondent might plead guilty but before the date of 19 March 1984 upon which the document was submitted to the Court. 64 In any event I do not regard the date of preparation of the document as of significance. If the document provides any support for the respondent's contention that active steps were taken after 28 October 1983 by Mr Knox to maintain the prosecution of the respondent, that support arises out of his preparation of the document and its submission to the Court in his presence on 19 March 1984. It does not matter when prior to its submission to the Court that he prepared the document. 65 The respondent submitted that in the absence of formal evidence being tendered it is necessary for a court that receives a plea of guilty to have a "Facts and Antecedents" document before it, or to have information to similar effect, to enable it to make a decision as to whether to accept the plea of guilty and to convict the accused. Whether the conviction occurs upon the acceptance of the plea or upon the passing of sentence (as to which see DPP v Arab [2009] NSWCA 75 at [31] – [36] and [44]) is not of significance in this case as on either view the conviction here occurred after and, so the parties in this case accepted, in reliance upon the "Facts and Antecedents" document (and of course upon the plea of guilty). 66 The District Court record also referred to "[a]ll police [being] present" at court on 19 March 1984. It is an obvious inference from this that Mr Knox and Mr Ross were present on that occasion. The respondent contended, and I consider that it should be accepted, that it is appropriate to infer, as a matter of strong probability, that these officers were present in the District Court for the purpose of giving evidence if the "Facts and Antecedents" document were challenged. 67 In my view these matters indicate that on 19 March 1984 Mr Knox in the relevant sense "maintained" the prosecution of the respondent. At first instance the respondent established that Mr Knox did so maliciously and without reasonable and probable cause. He did so because the judge found that Mr Knox had participated in the fabrication of the critical evidence against the respondent. Mr Knox therefore knew on 19 March 1984 of the falsity of the charge against the respondent. 68 Mr Knox was present at the District Court when the document that he had prepared and that he knew contained false information was tendered to the Court as material, and probably essential, support for the conviction and sentencing of the respondent. Mr Knox was not present in court simply as a spectator but was there to support the prosecution of the respondent by giving evidence to the effect of what was contained in the "Facts and Antecedents" document in the event that its veracity was challenged. The Crown Prosecutor who tendered the document was in the same position as the police officer in Martin v Watson [1996] AC 74 (described in A v New South Wales; see [59] above). As in that case, the facts relating to the alleged offence were not here within the Crown Prosecutor's knowledge and in progressing the prosecution of the respondent on 19 March 1984 he "could not have exercised any independent discretion" (see A v New South Wales at [35] quoted in [59] above). By making the document available for use by the Crown Prosecutor, Mr Knox put the Crown in possession of information which "virtually compel[led]" the Crown Prosecutor to press the charge (see ibid at [35]). 69 This conduct of Mr Knox satisfied the requirement that, to be liable for malicious prosecution, a defendant "must play an active role in the conduct of the proceedings" (A v New South Wales at [34] quoted in [59] above). The conduct of Mr Knox was in my view analogous to the steps that Harvey ACJ in Daniels v Telfer contemplated would lead to liability for malicious prosecution (see [54] above). His Honour there contemplated that it would be sufficient if a defendant gave evidence in support of a prosecution. What occurred in this case was equivalent to such conduct. A document prepared by Mr Knox for the purpose of evidence was, in his presence, tendered to the District Court as evidence. This occurred in circumstances where it must have been clear to those involved in the proceedings that, by his presence, Mr Knox was indicating that he was prepared, if required, to go into the witness box to swear to the facts contained in the document. His presence, without demur to the tender of the document, thus implicitly confirmed its veracity. It also involved (but went beyond) a suppression of the evidence that Mr Knox could have given as to the true circumstances of the arrest of the respondent. Both Harvey ACJ and Halse Rogers J specifically referred to the suppression of evidence as sufficient in this context (see [54] – [55] above). 70 Mr Knox thus took active steps after 28 October 1983 to maintain the prosecution of the respondent. This is sufficient to establish the liability of the appellant because the appellant is vicariously liable for a relevant tort committed by Mr Knox in this period, irrespective of the commission of torts by any other of the police officers concerned. Nevertheless, it is appropriate to add that I consider that Mr Ross' conduct was in the same category as that of Mr Knox and was therefore tortious in the same way. From the District Court record that "[a]ll police" were present, it can be inferred that Mr Ross also was in court on 19 March 1984. Whilst there is no evidence that he was involved in the preparation, or even read, the "Facts and Antecedents" document, he must have known when the document was tendered in his presence by the Crown Prosecutor in support of the conviction and sentencing of the respondent that it contained a version of the facts that was false. As with Mr Knox, his presence in court, without demur to what occurred, indicated his preparedness to give evidence in support of the document and of the prosecution and his confirmation of the veracity of the version of the facts described in the document. It amounted to suppression of the evidence that he could have given as to the true circumstances of the arrest of the respondent. Other hearing dates 71 It remains to refer to the other dates after 28 October 1983 upon which the prosecution of the respondent was before the District Court (see [28] above). 72 The respondent was sentenced in respect of the 1980 Charge on 7 June 1984. Mr Knox was recorded as being present. In light of what had occurred on 19 March 1984 in relation to the "Facts and Antecedents" document that Mr Knox had prepared and in light of his presence in the District Court on that occasion, it should in my view be concluded that Mr Knox maintained the prosecution in the relevant sense on that day, as he had done on 19 March 1984. Permitting the sentencing of the respondent to proceed in his presence and in reliance upon the "Facts and Antecedents" document that he had prepared and that he knew to be false, amounted in my view to suppression by him of the evidence he could have given as to the true facts relating to the 1980 Charge. 73 Mr Knox was also recorded as being present in court on 31 October 1983 (see [28] above). However no more is known about what occurred on that day than that the trial was adjourned and that an indication was apparently given to the Court that the respondent might plead guilty. I am not prepared to conclude on the basis of that limited evidence that Mr Knox "maintained" the prosecution in the relevant sense on that day. 74 There is no evidence that either Mr Knox or Mr Ross was present when the prosecution was before the court on 20 March 1984. As a result it cannot be concluded that either of those persons took any relevant active steps in the prosecution on that day. The primary judge's findings 75 The basis of the primary judge's findings about the liability of the appellant was broader than that founding the views I have expressed in [67] – [70], [72] above. His Honour took the view that those police officers who were aware of the fabrication of the evidence against the respondent were "subject to a duty to disclose his/their wrongdoing and not allow the prosecution to go forward based on manufactured evidence" (Judgment [151] quoted in [30] above). He considered that the relevant acts were "all acts by 'the prosecutor' [referring to Mr Knox and/or Mr Ross] after October 1983 in maintaining and pursuing the proceedings including the re-listing of them for ultimate hearing and disposal by conviction and sentence" (Judgment [141] and [151] quoted in [29] – [30] above). 76 These propositions are in my view too broad. The case authorities to which I have referred above indicate that it is necessary to identify "active steps" taken by the person alleged to have been a prosecutor. The active steps that were proved in this case were confined to those which I have identified in [67] – [70], [72] above. A mere failure to disclose is not sufficient. There need to be particular circumstances, as I have concluded that there were in respect of the court proceedings on 19 March and 7 June 1984, to enable what occurred to be considered "active steps". 77 I add in conclusion on this topic that the basis that I have given for finding that relevant acts of prosecution occurred after 28 October 1983 reflects grounds contained in a Notice of Contention that the respondent was given leave to file in the course of the hearing to enable him to support the judge's conclusions on different bases than those given by his Honour. 78 The appellant contended in Written Submissions filed after the hearing in this Court that the decision to grant leave should be "revisited". It contended that this aspect of the respondent's case was not litigated at first instance. I do not accept this submission as the respondent's contentions were within his pleadings and supported by the evidence to which I have earlier referred. Further, the appellant did not suggest that the respondent at any time withdrew the relevant allegations in his pleadings. The challenge to Mr Haken's evidence 79 The appellant submitted that Mr Haken's evidence relating to the planting of heroin in the respondent's vehicle was "glaringly improbable or alternatively inconsistent with objective facts" (Written Submissions [34]). In the alternative it submitted that the primary judge's acceptance of Mr Haken's evidence was "vitiated by failure on his Honour's part to consider all of the evidence which was relevant to the issue of Mr Haken's creditworthiness" (Written Submissions [35]). By framing its submissions in this manner, the appellant recognised that the primary judge's findings as to whether the evidence in support of the 1980 Charge against the respondent was fabricated rested heavily on his Honour's views as to the credibility of the witnesses who gave evidence before him. Demeanour played a significant role in the judge's assessment of Mr Haken's evidence (see [33] as to his Honour's conclusions in this respect). 80 In these circumstances, to sustain its submissions the appellant had to point to "incontrovertible facts or uncontested testimony [demonstrating] that the trial judge's conclusions are erroneous" or that the decision below is "glaringly improbable" or "contrary to compelling inferences" (Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 at [28] – [29]). 81 I turn to consider the matters relied upon by the appellant in its attempt to discharge this burden. The respondent's presence on the motorway 82 The appellant submitted that on Mr Haken's version of the events of mid January 1980 the police could not have "known what route the respondent would take after he left his house if he were to leave his house at all on 15 January 1980" (Written Submissions [36(b)]). It asserted that there were at least three different routes the respondent might have taken to travel to Sydney and that the police would not in any event have known that the respondent would leave his house at all on 15 January 1980. 83 This is not in my view a compelling argument against acceptance of Mr Haken's evidence. As the primary judge pointed out in relation to a corresponding submission made to him, "police had been conducting surveillance and monitoring [the respondent] at his home for some weeks prior to 15 January 1980, and had the benefit of information that that provided as to any pattern to the [respondent's] movements" (Judgment [414]). Further, Mr Haken said when pressed about this issue that it was likely that the police had some information as to the likelihood of the respondent using the freeway travelling towards Sydney (Judgment [219]). The statement allegedly made when the respondent's vehicle was stopped 84 The respondent gave evidence that when he was pulled over by the police on the freeway, Mr Knox said to him that "we have reason to believe that you have got drugs at your place". Mr Ross gave evidence to similar effect, whilst Mr Haken did not refer to such a statement. The effect of the appellant's submissions was first that this was an instance of Mr Haken's evidence being inconsistent with the respondent's corroborated evidence and secondly that what was allegedly said pointed to the respondent having been stopped because the police had information about his involvement in a drug transaction rather than, as Mr Haken asserted, because the police wished to plant drugs in his vehicle. 85 I do not regard these matters as of particular significance. First, the fact there were inconsistencies on matters of detail between the evidence of Mr Haken and other witnesses is not surprising when the evidence of Mr Haken at the hearing at first instance was given over 26 years after the events in question. In his evidence he repeatedly referred to the understandable difficulty of recalling events which had occurred so long before (see Judgment [205], [210] and [213]). Secondly, the fact that the statement deposed to by the respondent may have been made when the respondent's vehicle was stopped does not mean that the police did in fact have reason to believe that the respondent had drugs in his vehicle. Consistently with Mr Haken's evidence, the statement could well have been made simply for the purpose of proffering to the respondent a reason for stopping him, particularly when there was another person, namely the respondent's partner, Ms Moore, in the vehicle. It is hardly likely that the police would stop the respondent and his partner and inform them that they were about to plant drugs in his car. It is almost inevitable that they would proffer some seemingly legitimate excuse for stopping him. The search of the second car 86 The appellant submitted that the fact that the police officers conducted a search of a second car located at the respondent's home (in which vehicle they allegedly found drugs) was inconsistent with the methodology upon which Mr Haken said the police had agreed. 87 There was however no necessary inconsistency between this search and Mr Haken's evidence. There is no obvious reason why what, on Mr Haken's evidence, had occurred on the freeway should not have led to a search of the respondent's home and of another car found there. Mr Haken said in evidence that the respondent was "a notorious drug supplier" and Mr Chidgey gave evidence that the respondent had been a target of the New South Wales police "for quite a period of time" (Judgment [226] and [375]). It would have been surprising for the police not to take the opportunity to attempt to obtain legitimate evidence, if they could, to use against the respondent. Which police officers were involved? 88 Mr Haken gave evidence that "all six officers … had a number of conversations in relation to the methodology of the operation" to be carried out (Judgment [204]). The primary judge however declined to make adverse findings against three of those officers (see [35] above). The appellant submitted that this revealed an inconsistency in the judge's findings which his Honour did not explain. 89 There is no necessary inconsistency in these findings. Acceptance by the primary judge of the central element of Mr Haken's evidence, namely, that drugs had been planted on the freeway in the respondent's vehicle, did not require his Honour to accept all of Mr Haken's evidence. The judge gave a clear explanation of why he was not prepared to make adverse findings against three of the police officers (Judgment [472] – [473]). Mr Haken's evidence in relation to these officers was lacking in detail and there is nothing remarkable about the judge not being prepared to make findings of very serious misconduct on the part of those police officers on the basis of such evidence. This does not indicate that the judge thought that Mr Haken had lied about their involvement. The effect of the judge's views was that, whilst he found the evidence in relation to the senior officers, Mr Knox and Mr Ross, to be convincing, he thought that there was too great a chance for Mr Haken to be mistaken about the three more junior officers to make findings of dishonesty against them. Dilution of the heroin with icing sugar 90 Mr Haken gave evidence that Mr Ross and Mr Knox instructed him to "dilute the heroin with icing sugar". The appellant submitted that there would have been no point in diluting the heroin because "it was only the weight of the actual heroin which was important for the relevant charge". 91 The primary judge dealt with a submission to this effect by saying that there was in fact a reason for diluting the heroin because the offence under the Poisons Act of which the respondent was charged depended upon the gross weight as distinct from the net heroin content of the substance found (Judgment [417], [418(7) – (8)]). No persuasive reason was given on appeal why this view should not be accepted. In particular, no statutory provision was referred to which established the contrary of his Honour's finding. The reason for stopping the respondent on a freeway 92 The appellant contended that the fact that the police chose to stop the respondent in a public place, namely on the freeway, rather than to plant the drugs on him at his home, pointed against Mr Haken's version of events. 93 I do not find this submission compelling. The police officers involved may well have seen the freeway as a place, although public, where the planting of the drugs could occur without intrusive observation from any member of the public, as any members of the public in the vicinity would be likely to be driving at high speed past the stopped vehicle. The fact that the respondent was stopped on the freeway does not unequivocally, or indeed at all, undermine the credibility of Mr Haken's evidence. Motives to lie 94 The appellant submitted that the primary judge effectively reversed the onus of proof by requiring the appellant to establish that Mr Haken had lied to the Wood Royal Commission. I do not consider that the primary judge did this. It was proper for him to consider the motives of those who gave evidence before him and to consider Mr Haken's position when he gave evidence to the Wood Royal Commission. He did not do more than this. 95 Further, the judge did not, as the appellant contended, fail to take into account the position of the four police officers who gave evidence for the appellant. This is evident from his Honour's discussion of the "Briginshaw Standard" ([436] – [437]), his Honour's discussion of the use of "circumstantial evidence in a civil case in relation to findings of criminal conduct" (Judgment [438] – [445]) and from his Honour's express reference to the appellant's submission that these four officers were persons "without a stain on their record" (Judgment [422]). In any event it should be recalled that the judge declined to find that three of these officers, that is, Messrs Gardiner, Leary and Chidgey, were involved in the fabrication of evidence. The judge's acceptance of Mr Haken's evidence as to the involvement of Mr Ross and Mr Knox was thus not inconsistent with the denials by Messrs Gardiner, Leary and Chidgey of any knowledge on their part that drugs were planted in the respondent's vehicle, although it was inconsistent with the evidence of the fourth, Mr Ross. Demeanour 96 The appellant submitted that the primary judge's ability to assess Mr Haken's demeanour "must have been severely compromised" by the fact that his evidence was taken over a video link. 97 That Mr Haken gave his evidence over a video link did not preclude the judge making observations of Mr Haken's demeanour and taking them into account in forming his views. The judge recognised that that method of taking evidence might impact on a judge's ability to assess a witness but observed that "there was nothing that … made it difficult to see or hear Mr Haken on the occasions he gave evidence" (Judgment [267]). The appellant did not show that the judge was in any way in error in the manner in which he dealt with the video link evidence. Generally 98 None of the matters relied upon by the appellant in this context, taken alone or cumulatively, in my view points to error in his Honour's conclusions about the credit of Mr Haken. They are some out of a very large number of points potentially relevant to the primary judge's conclusion as to which version of events to accept. The judge cannot be criticised for not referring to all possible points or to all of those identified by the appellant, even if it be assumed that the appellant's points were all put to his Honour in the form in which they were put to this Court. His Honour presided over a lengthy trial and wrote a detailed, carefully reasoned judgment in which he set out his reasons for accepting Mr Haken's evidence. He did not have to mention every point capable of bearing upon the issue at hand. None of the appellant's arguments indicates that the judge's conclusions were "glaringly improbable" or "contrary to compelling inferences" or that his Honour failed to deal with any point of compelling significance about Mr Haken's evidence. 99 In my opinion the appellant's challenge to the primary judge's acceptance of Mr Haken's evidence has failed to surmount the hurdles placed in its path by the principles enunciated by the High Court in Fox v Percy. Damages 100 Subject to the question of damages, the views I have expressed above lead to the conclusion that Mr Knox committed the tort of malicious prosecution on 19 March 1984 and 7 June 1984, that Mr Ross did so on 19 March 1984 and that, because the torts arose out of wrongful acts occurring after 28 October 1983, the appellant is vicariously liable in respect of those torts. 101 The only damages to which the respondent is entitled are those that reflect loss related to those particular acts. It is apparent however that the damages awarded by the primary judge extended considerably further. I shall deal in turn with each of the heads of damages claimed. 102 As noted (see above at [40]), the primary judge declined to award damages for injury to reputation. This decision is not challenged. 103 The award by the judge of $5,000 in respect of economic loss appeared to relate only to events prior to 28 October 1983 (see [41] above). He did not find that any economic loss flowed from the events of 19 March and 7 June 1984. As a result the respondent is not entitled to any damages for economic loss. 104 Similarly the damages of $35,000 awarded by the primary judge in respect of the risk of the respondent being imprisoned related to the period from 16 January 1980 to 19 July 1982 (see [42] above) and accordingly did not flow from the events of 19 March and 7 June 1984. The respondent is thus not entitled to damages under this head. 105 The judge's award of $30,000 aggravated damages for "mental distress and agitation" also cannot stand as only in small measure did it relate to events occurring after 28 October 1983 (see [43] above). The damages under this head should be confined to a reflection of the mental distress that the respondent suffered as a result of his wrongful conviction and sentencing on 19 March and 7 June 1984. Most of the mental distress suffered by the respondent can be taken to have flowed from the matters that occurred earlier than 19 March and 7 June 1984 and to which the judge referred. These matters were his wrongful arrest and charge in the presence of his partner, his detention and forced return to his home, the search of his home and consequent invasion of his privacy and that of his partner, and his attempts to establish his innocence and avoid committal for trial (Judgment [514] – [516]). 106 During the hearing in this Court the respondent sought leave to file a Notice of Cross Appeal seeking orders reassessing the respondent's damages. The appellant opposed the grant of leave, upon the bases that the respondent called "insufficient evidence" to support his case and that evidence might have been called below by the appellant on "the issue of post 28 October [1983] stress and anxiety". 107 In my view leave should be granted. The respondent pleaded that he had suffered hurt and distress, did not limit that allegation to any particular period and called some evidence capable of supporting it. The appellant must have been well aware that it should call such evidence on this issue as it thought appropriate. 108 In these circumstances I consider that this Court should reassess the award of aggravated damages (and the award of exemplary damages, to which I will come). 109 In a report dated 15 July 2003 Dr Bruce Westmore, a forensic psychiatrist, said that he accepted that the respondent "would have suffered in the past symptoms of anxiety and depression and that on the balance of probability he continues to suffer symptoms of that type today". Dr Westmore referred to the respondent's "extreme anger" about what had happened to him, including about the fact that he had been "falsely accused [of] and evidence was fabricated about his involvement with drugs". 110 On the basis of this evidence and of common sense I consider that, notwithstanding that at the time of the events of 19 March and 7 June 1984, the respondent was serving a term of imprisonment on the 1982 charges, the Court should conclude that those events caused a degree of mental distress to the respondent beyond that which flowed from the pre-28 October 1983 events. In my view he should be awarded $10,000 as damages in respect of that distress. 111 The appellant contended that an award in respect of the post 28 October 1983 events would be inconsistent with the primary judge's findings which the appellant contended included a finding that any distress suffered by the respondent had "resolved" at least by the time of his involvement in the events which led to the 1982 charges. However the judge's finding was that the respondent's distress would have "reduced" by that time, not that it would have ceased to exist (see [43] above). 112 As pointed out earlier (see [44] above) the primary judge's award of exemplary damages appears to have been based on the events of January 1980. As it did not therefore relate to the events of 19 March and 7 June 1984 it must be set aside and damages under this head reassessed. 113 The purposes of an award of exemplary damages were referred to by the plurality in Lamb v Cotogno [1987] HCA 47; (1987) 164 CLR 1. Their Honours quoted with approval the following observations of Brennan J in XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; (1984-1985) 155 CLR 448: "'As an award of exemplary damages is intended to punish the defendant for conduct showing a conscious and contumelious disregard for the plaintiff's rights and to deter him from committing like conduct again, the considerations that enter into the assessment of exemplary damages are quite different from the considerations that govern the assessment of compensatory damages. There is no necessary proportionality between the assessment of the two categories. In Merest v Harvey ((1814) 5 Taunt. 442; 128 ER 761) substantial exemplary damages were awarded for a trespass of a high-handed kind which occasioned minimal damage, Gibbs CJ saying: `I wish to know, in a case where a man disregards every principle which actuates the conduct of gentlemen, what is to restrain him except large damages?' The social purpose to be served by an award of exemplary damages is, as Lord Diplock said in Broome v Cassell & Co ([1972] AC, at p 1130) `to teach a wrong-doer that tort does not pay'" ( XL at 471; Cotogno at 9). 114 The decision of the High Court in New South Wales v Ibbett [2006] HCA 57; (2006) 229 CLR 638 confirmed that exemplary damages may be awarded against a person who, although not personally responsible for the commission of the relevant tort, is vicariously liable in respect of such a tort and that there is no barrier to the award of such damages against a State in respect of conduct of police officers for whose torts the State is responsible. The plurality judgment in that case approved the following observation of Priestley JA in Adams v Kennedy [2000] NSWCA 152; (2000) 49 NSWLR 78: "That figure [of exemplary damages] should indicate my view that the conduct of the [police officer] defendants was reprehensible, [and] mark the court's disapproval of it. The amount should also be such as to bring home to those officials of the State who are responsible for the overseeing of the police force that police officers must be trained and disciplined so that abuses of the kind that occurred in the present case do not happen" ( Adams at 87; Ibbett at [51]). 115 In the present case the conduct of the police officers for which the State was vicariously liable involved abuses, of a most serious kind, of the rights of a citizen and of the criminal justice system. The conduct deserves severe condemnation. The purposes of punishment and deterrence are central to an award of exemplary damages. To fulfil these purposes I would award in relation to the conduct of 19 March and 7 June 1984 that has been found to give rise to the torts of malicious prosecution, the sum of $50,000 as exemplary damages. Costs 116 In these circumstances my view is that the appellant should be ordered to pay 50 per cent of the respondent's costs of the appeal and cross appeal. The appellant succeeded in having the damages awarded at first instance substantially reduced. However, the respondent maintained the decision in his favour on liability (although only on a more confined basis than that reflected in the Judgment at first instance) and most of the oral argument on the appeal related to liability. The same emphasis was apparent in the written submissions. 117 On the material before the Court there is no reason why the costs order made at first instance should be disturbed. Orders 118 I propose the following orders. (1) Appeal allowed in part; (2) Leave granted to the respondent to file a Notice of Cross Appeal in the form provided to the Court on the hearing of the appeal; (3) Cross appeal allowed; (4) Set aside orders (1) – (5) made by Hall J on 22 May 2009 in respect of the 1980 Charge; (5) In lieu of the orders set aside, enter judgment for the respondent against the appellant in the sum of $60,000, comprised of $10,000 aggravated damages and $50,000 exemplary damages; (6) Order that the appellant pay interest on the amount of $10,000 in respect of aggravated damages from 2 November 2001 until the date of this judgment at the rates prescribed in Schedule 5 of the Uniform Civil Procedure Rules; (7) Order that the appellant pay 50 per cent of the respondent's costs of the appeal and cross appeal; and (8) The respondent to have a certificate under the Suitors' Fund Act 1951 , if qualified. 119 SACKVILLE AJA: I agree with Macfarlan JA. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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