Carthew v Badger & Ors

LOWER COURT Compensation Court JURISDICTION : LOWER COURT CC 12381/02 FILE NUMBER(S) : LOWER COURT Hughes CCJ JUDICIAL OFFICER :

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40960/03 CC 12381/02

GILES JA SANTOW JA IPP JA

Tuesday 14 September 2004 CARTHEW v BADGER & ORS Judgment 1 GILES JA: On 30 March 2001 Ms Ariel Carthew was injured when she dived into a shallow 25 metre swimming pool at North Sydney Olympic Pool ("the Pool") and struck her head on the bottom of the pool. At the time she was employed by Mr Stephen Badger, who conducted a swimming school at the Pool. She claimed compensation under the Workers Compensation Act 1987 ("the Act"), joining as respondents Mr Badger as her employer, Workcover Authority of New South Wales because Mr Badger was uninsured, and North Sydney Council as the alleged principal of Mr Badger. 2 The proceedings were heard before Hughes CCJ on 26 February and 23 June 2003. His Honour published his reasons on 9 October 2003. He made awards in favour of each of the respondents. 3 Ms Carthew appealed to this Court. Her appeal was limited to an appeal in point of law or in relation to the admission or rejection of any evidence (Compensation Court Act 1984, s 32(1)). There were numerous and largely inappropriate grounds in the notice of appeal. In the result, the sole ground of appeal was that the judge had given inadequate reasons for his decision. This can be error in point of law, see for example Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247.

The competing accounts 4 The parties were at issue over whether Ms Carthew's injury was an injury arising out of or in the course of her employment, see the definition in s 4(a) of the Act. On Ms Carthew's case, she was employed by Mr Badger on the basis that she could have free swimming lessons as a perquisite of her employment as a receptionist, and she was having such a lesson from one of the swimming school instructors, Mr Darren Quinn, on the occasion of her injury. The respondents contested that free swimming lessons were a perquisite of the employment, and also that Ms Carthew was having a lesson from Mr Quinn, free or otherwise, on the occasion of her injury. On their case, Ms Carthew was injured when she intervened, quite outside her employment, in a lesson given by Mr Quinn to some children, and dived into the pool despite being told not to do so. 5 Ms Carthew gave evidence of conversations with Mr Badger when she was engaged in which free swimming lessons were offered. Her hours of work as receptionist were 1 pm to 7 pm. She said that she had had lessons from Mr Quinn on a number of occasions prior to the occasion of her injury, usually at about 6.30 pm. She said that on the particular occasion she decided to take her lesson at 6 pm and spoke to Mr Quinn about doing so because his class had not shown up, that she asked Ms Michelle Krohn to watch the desk and answer the phones, and that she then went to the pool for the lesson. She said that Mr Quinn decided that she should have a diving lesson, how she first dived into the pool through a hoop held by him, and how she dived in again through the hoop held by Mr Quinn flat on the surface of the water so that she dived deeply in the shallow pool and struck her head. 6 Ms Krohn was called in Ms Carthew's case. She said that she had seen Ms Carthew having lessons from Mr Quinn on one or two prior occasions. Of the particular occasion, she said that Ms Carthew spoke to her about taking over at the reception desk, which she did, and that Ms Carthew said that she was to have a lesson with Mr Quinn. She said that she spoke to Mr Quinn, saying that Ms Carthew was extremely short sighted and that he should be careful not to let her dive. She did not see what happened in the pool, but she said that Mr Quinn later told her that Ms Carthew had hit the bottom of the pool in their lesson. 7 Ms Carthew's case was contested through the evidence of Mr Badger and Mr Quinn. Mr Badger denied the conversations, and that Ms Carthew's employment included free swimming lessons and that she had ever had any such lessons. He said that if he were to let Ms Carthew have free lessons, he would have to let all his other employees have free lessons, and that he did not do so. He did not see what happened at the pool on the occasion of Ms Carthew's injury. Mr Quinn denied knowing of any arrangement for free lessons to swimming school employees in general and Ms Carthew in particular. He said that he had never given Ms Carthew swimming lessons, although sometimes before starting work he would give her stroke correction in the 50 metre pool at the Pool as an act of friendship. As to the particular occasion, he said that he was conducting a class with three young children, teaching them shallow dives including diving through a hoop; that Ms Carthew appeared and dived through the hoop; that he told her that she was being irresponsible and stupid and not to do it again; and that she nonetheless dived into the pool again through the hoop he was holding behind his back, and hit her head. 8 This evidence was given on 26 February 2003. On 23 June 2003 Ms Carthew tendered an accident report and a page from an incident register, both completed by Mr Michael Cartwright, a lifeguard employed by North Sydney Council at the Pool. Mr Cartwright did not give evidence. In the accident report he said that he observed the incident, describing it at one point as "Lady dived off block through hoop, hitting forehead on bottom of pool" and at another as "Diving off blocks on 25 m pool", and under the heading "Type of Activity" ticked the box "Swim Lesson". His description in the incident register began, "The Lady was having a diving lesson in the 25 m pool. She dived off the blocks through a hoop and hit her head on the bottom of the pool. Instructor put a towel round her head … ".

The reasons 9 It appears to have been accepted below (and was accepted on appeal) that Ms Carthew's injury did not arise out of or in the course of her employment if it occurred in the circumstances described by Mr Badger and Mr Quinn rather than in the circumstances described by Ms Carthew and Ms Krohn. Whether Ms Carthew's employment included the provision of free swimming lessons was material to finding the circumstances in which the injury was suffered, although not determinative. The judge preferred the evidence of Mr Badger and Mr Quinn to that of Ms Carthew and Ms Krohn. He found that Ms Carthew "was not in the course of employment nor were her injuries arising out of employment". 10 After introductory matters, the judge said - "3. It became clear during the hearing that the real matter of controversy was whether or not the applicant was in the course of her employment or her accident arose out of her employment when it occurred. 4. The applicant alleges that she was employed as a receptionist by the first respondent and that it was a perquisite of her job to get free swimming lessons. The respondent contests this, and says no, the applicant was not given free lessons as a perquisite, she was employed as a receptionist simplicita [sic]. This question of fact, given the totally opposite positions taken by the parties has at least to be resolved in order to determine the case. If the applicant does not succeed on the balance of probabilities that the swimming lessons were a perquisite of the job then I have to look at other evidence as to whether it arose out of her employment or she was in the course of her employment when the injury occurred. It was not asserted by the applicant that the alleged perquisite could be taken during her normal working hours. 5. There were two versions of the incident and I will analyse the evidence of the two people who were there during the instance as well as other witnesses called in the case. … " 11 The judge identified the pages of the transcript in which were to be found the evidence, including cross-examination, of Ms Carthew. He said that he found Ms Carthew's evidence "to be unreliable", giving as his reasons certain non-disclosures to doctors revealed in the cross-examination and the medical reports and dissatisfaction with her description of swimming and diving lessons. 12 The judge then turned to Ms Krohn. He said that she "was not present at the incident when Ms Carthew suffered an injury" and that she "substituted Ms Carthew [sic] at the reception desk which was Ms Carthew's workstation". He said she gave evidence that she filled in as receptionist "at 6 o'clock when Ms Carthew requested it". He referred to and in part set out evidence in her cross-examination to the effect that free swimming lessons were a matter between Ms Carthew and Mr Badger, she could not say whether Ms Carthew was "authorised to have swimming lessons during her employment with Mr Badger", and she did not see a lesson sheet, as was required, with Ms Carthew's name. He went on - "9. Mr Deggens cross-examined Ms Krohn and in the cross-examination at page 32 line 27 she admitted she was a close friend of Ms Carthew's now. They talk on the telephone quite frequently and it was put to her that the evidence she gave may not be sound because of her frequent conversation with Ms Carthew, the inference being that the frequent conversations with the applicant could interfere with Ms Krohn's clear recollection of events. And, as I mentioned before, Ms Krohn did not see the accident." 13 The judge then turned to the evidence of Mr Badger in which Mr Badger denied that Ms Carthew's employment included free swimming lessons and spoke of other matters not presently material. He set out some passages and summarised others. 14 Finally the judge turned to the evidence of Mr Quinn. He set out at some length the evidence in which Mr Quinn denied any knowledge of arrangements for free swimming lessons, gave his account of stroke correction as a friend before starting work, and gave his accounts in chief and in cross-examination of the occasion of Ms Carthew's injury. 15 The judge concluded - "15. I don't accept the evidence of Ms Carthew about the incident and the provision of free swimming lessons and where her evidence conflicts with that of Mr Quinn and/or Mr Badger I accept them. Ms Krohn could shed no light on the provision of free swimming lessons. I found Mr Quinn in particular to be a honest and straightforward witness, a kind fellow who was not shaken by cross-examination, I accept his evidence totally. As he was no longer an employee of the first respondent he had nothing to gain by not telling the truth. Mr Beauchamp faintly attempted to attack his credit by suggesting he may have been guilt-stricken. I do not accept that submission and I find Mr Quinn and Mr Badger to be wholly credible witnesses. 16. I therefore find as a matter of fact that Ariel Carthew was not authorised by Mr Badger to have free swimming lessons as a perquisite of her job. I find that Mr Quinn gave her some stroke correction lessons before she commenced her work day. I find that on the day of question [sic] the applicant took herself outside her employment by diving into a pool when she was supposed to be at the reception desk. I find that when asked not to dive into the pool again by Mr Quinn she did dive in again and injured herself. Having decided those facts, what then do I do decide about whether she is in the course of her employment or the incident arose out of her employment? 17. She was in the working hours of her employment. I find that she was engaged in activity that was not required nor authorised by her employer. I do not find that her taking swimming lessons was in the interests of her employer. I find that she left her task as a receptionist to go on what amounts to a frolic of her own by diving into the pool at the time Mr Quinn was taking a class. I find that her leaving her post and diving into the small pool took her out of the course of employment. In those circumstances I find she was not in the course of employment nor were her injuries arising out of employment." 16 The judge made no reference to the accident report and the page from the incident register.

Discussion 17 Ms Carthew submitted that the reasons were inadequate in three respects, namely -

(a) failure to deal with Ms Carthew's evidence of her discussions with Mr Quinn arranging for the lesson and with Ms Krohn arranging the takeover of her post as receptionist;

(b) failure to deal with Ms Krohn's evidence of being asked to take over the post as receptionist because there was to be a lesson and of speaking to Mr Quinn about it; and

(c) failure to deal with the accident report and the page from the incident register recording that Mr Cartwright observed the activity of a swimming lesson and that Ms Carthew was having a dividing lesson. 18 It has been said on many occasions that the content of reasons depends on the circumstances of the particular case. It is not necessary to refer to all the evidence in the proceedings to indicate which of it is accepted or rejected, or to refer to the relevant evidence in detail, especially in circumstances where it is clear that the evidence has been considered. And, as was said in Soulemezis v Dudley (Holdings) Pty Ltd at 281 - "In a case where a right of appeal is given only in respect of a question of law, different considerations apply from the case where there is a full appeal. An ultimate finding of fact, which is not subject to appeal and which is in no way dependent upon the application of a legal standard, can be treated less elaborately than an issue involving a question of law or mixed fact and law. If no right of appeal is given against findings of fact, a failure to state the basis of even a crucial finding of fact, if it involves no legal standard, will only constitute an error of law if the failure can be characterised as a breach of the principle that justice must be seen to be done. If, for example, the only issue before a court is whether the plaintiff sustained injury by falling over, a simple finding that he fell or sustained injury would be enough, if the decision turned simply on the plaintiff's credibility. But, if, in addition to the issue of credibility, other matters were relied on as going to the probability or improbability of the plaintiff's case, such a simple finding would not be enough." 19 It may be that particular evidence, beyond the credibility of witnesses, is important or critical to the finding of fact. If it is not referred to, it may be inferred that it was not duly considered and the reasons may be deficient: Beale v Government Insurance Office of New South Wales (1997) 44 NSWLR 430 at 443. If it is referred to but without any analysis of the evidence from which it can be seen why, having regard to it and the other evidence, the judge came to the finding of fact, again the reasons may be deficient: illustrations are Sinha v Health Care Complaints Commission [2001] NSWCA 206 and Fitzgibbon v The Waterways Authority [2003] NSWCA 294. In the first of these cases it was held that reasons were insufficient when the evidence of one witness was accepted without proper regard to unchallenged conflicting evidence of another witness. The nature of the evidence must be assessed, see Mifsud v Campbell (1991) 21 NSWLR 725 at 728 - "Accordingly, a failure to refer to some of the evidence does not necessarily, whenever it occurs, indicate that the judge has failed to discharge the duty which rests upon him or her. However, for a judge to ignore evidence critical to an issue in a case and contrary to an assertion of fact made by one party and accepted by the judge - as the defendant's denial of having consumed alcohol - may promote a sense of grievance in the adversary and create a litigant who is not only "disappointed" but "disturbed" - to use the words which appear in the New Zealand case of Connell v Auckland City Council [1977] 1 NZLR 630 at 634. It tends to deny both the fact and the appearance of justice having been done. If it does, as in my opinion is the case here, then it will have worked a miscarriage of justice and have produced a mis-trial and resulted in what I would take to be an error of law which is reviewable on appeal." 20 I do not think there is any substance in Ms Carthew's complaints in the first two respects. 21 The judge was alive to the whole of the evidence of Ms Carthew, and the transcript references which he identified included her evidence of her discussions arranging with Mr Quinn for the lesson and with Ms Krohn to take over her post as receptionist. That evidence fell with the unreliability, as assessed by the judge, of Ms Carthew's evidence. The judge gave reasons for the view he took of the reliability of Ms Carthew's evidence, and it was not suggested that it was not open to him to take that view. More expansive reference to the evidence in question was not required. 22 The judge referred specifically to Ms Krohn's evidence that she filled in at the receptionist desk at 6 pm when Ms Carthew requested it. He did not refer specifically to her evidence of speaking to Mr Quinn. Again, however, it was not necessary for him to do so when he accepted the evidence of Mr Quinn in full, as he was entitled to do for the reasons he gave. Ms Krohn's evidence also fell with the judge's necessarily implicit view that Ms Krohn should not be accepted in preference to Mr Quinn, and although not expressly stated I would understand from his mention of the cross-examination of Mr Deggens that the judge thought Ms Krohn's evidence compromised by her frequent conversations with Ms Carthew. 23 The accident report and the page from the incident register aside, the judge's findings of fact turned upon the credibility he ascribed to Ms Carthew and Ms Krohn on the one hand and Mr Badger and Mr Quinn on the other hand. It was apparent why the judge considered that Ms Carthew suffered her injury in the circumstances described by the latter. The circumstances were quite different from those in, for example, Sinha v Health Care Complaints Commission. 24 There is more to be said for Ms Carthew's complaint in the third respect. The judge did not refer to the accident report and the page from the incident register. Was this evidence of such importance that the reasons were inadequate in failing to explain why, notwithstanding what Mr Cartwright recorded, the judge accepted the evidence of Mr Quinn? 25 Ms Carthew submitted that the accident report and the page from the incident register had been overlooked in the judge's fact-finding, because the judge had said (see para [10] above] that he would analyse the evidence "of the two people who were there during the instance … ". There were more than two people there, it was said, because Mr Cartwright was there as well as Ms Carthew and Mr Quinn: therefore Mr Cartwright had been overlooked. I do not agree. The reference to the two people who were there was apt for the immediate participants, Ms Carthew and Mr Quinn. It did not have to include the bystander, Mr Cartwright. 26 It remains that the accident report and the page from the incident register were not mentioned. It can readily enough be seen, in my opinion, why the judge would have not have thought that they weighed against his acceptance of the evidence of Mr Quinn. Mr Quinn was a witness who the judge had seen and heard, and who impressed him favourably. The records relevantly stated that Mr Cartwright observed a swimming lesson or a diving lesson, which was consistent with the evidence of Mr Quinn because there was a lesson, the lesson conducted for the three children in which Ms Carthew intervened. It was not known where Mr Cartwright was positioned when he saw what he recorded and, for all that appeared, to his observation there was a lesson involving Ms Carthew when in truth there was a lesson involving the three children in which Ms Carthew intervened. 27 The judge did not express this reasoning, but I do not think that, in the circumstances, the accident report and the page from the incident report were so critical that failure to refer to them would breach the principle that justice must be seen to be done. The reason why they would not be of weight against the judge's view of Mr Quinn as a credible witness was open to be inferred, although unstated. Ms Carthew knew from the reasons why the judge found as he did, and inadequacy of reasons is not demonstrated by pointing to evidence which on ready analysis does not really count against the finding made. 28 In my opinion, the appeal should be dismissed with costs. 29 SANTOW JA: I agree with Giles JA 30 IPP JA: I agree with Giles JA.

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