Church v Echuca Regional Health [2008] VSCA 153

Accident Compensation Act 1985, s 134AD.

1 I agree with Ashley JA, for the reasons he has stated, that the appeal should be allowed.

2 There was an impressive body of evidence from medical practitioners and occupational health workers, who had treated and examined the appellant, that she suffered from depression and chronic pain syndrome and that condition had persisted for years. In my view the evidence established that the appellant's disorder was permanent and severe.

3 The scenes depicted in the surveillance films and the fact that when she gave evidence in court the appellant cradled her right arm with her left arm as if it were in a sling do not warrant the rejection of the appellant's case. That case was based upon pain caused by physical activity. The actions depicted in the films were neither physically stressful nor protracted. There appeared to be no reason for rejecting the appellant's claim that she experienced good days and bad days. Certainly, no reason was assigned by the trial judge.

4 Upon the evidence and other material before the trial judge, I consider that it was established that the appellant sustained a serious injury within the meaning of s 134AB(37) of the Accident Compensation Act 1985.

5 Karyn Church, the appellant, made application under s 134AB(16)(b) of the Accident Compensation Act 1985 ('the Act') for leave to issue a proceeding for the recovery of damages. Her application was heard by a judge of the County Court on 30 August 2007. The appellant relied upon injury which she claimed satisfied both paragraphs (a) and (c) of the definition of 'serious injury' contained in s 134AB(37) of the Act. The paragraph (a) injury which she alleged was 'injury to the cervical spine, right and left shoulders and arms'. The paragraph (c) injury which she alleged was 'chronic pain syndrome, depressive illness, anxiety and depression'. The main

6 The evidence adduced on the hearing of the application consisted of the appellant's affidavits sworn 27 June 2006 and 1 November 2006, additional viva voce evidence given by the appellant,[1] the reports and medical records of doctors and of allied health professionals, a vocational assessment, a number of rehabilitation assessment reports, four surveillance films, and admissions made by the respondent, Echuca Regional Health, as to the dates and times of surveillance of the appellant. Further, the judge who heard the application made a particular observation of the appellant's demeanour whilst she gave her evidence, and recorded it in his reasons.

7 None of the doctors, allied health professionals or other persons whose reports and correspondence were put in evidence was called viva voce. So, to the extent that there was any disagreement in the material, it remained unresolved.

8 The judge dismissed the application. He delivered written reasons for judgment on 6 September 2007. As will appear, his Honour rejected the appellant's credibility in reliance upon what was shown by the surveillance film and upon the particular observation which he made as to the appellant's demeanour in the witness box.

9 The appeal was pressed on two bases. First, it was submitted that the reasons for judgment were inadequate. They did not enable the appellant to understand, by reference to a sufficient and coherent path of reasoning, why she had lost. Second, it was contended that the judge should have found, and this Court should find, that the appellant had made out a paragraph (c) serious injury in respect of both pain and suffering and loss of earning capacity consequences.

10 In my opinion, the appellant has made good each of those attacks.

Employment, injury, treatment, medical assessment, surveillance

11 In different contexts, the two bases on which the appeal was pressed require systematic analysis of the evidence which was adduced below. I turn to that evidence.

12 The appellant, a woman born 6 March 1957, was employed as an instrument technician in the central sterilising surgical department operated by Echuca Regional Health between 1995 and June 2003. Her work required activities which put considerable stress on her arms, shoulders and cervical spine.

13 Although the appellant had suffered some medical problems over the years, there was nothing in the material before the judge below to indicate that she had been otherwise than a satisfactory employee up until July 2002. Indeed, the fact that she had suffered health problems but had kept up her employment tends, I think, to a conclusion that she was motivated to work.

14 Be that as it may, in July 2002 the appellant consulted her general practitioner complaining of symptoms affecting her right arm, shoulder and neck. She attributed the development of symptoms to the physical stresses of her work. She was put on to treatment and was put off work.

15 Now I will trace the appellant's complaints, her treatment, and medical opinion, in the period between July 2002 and trial; and in that context refer to her affidavits, her viva voce evidence, and the surveillance film relied upon by the respondent.

16 Between July 2002 and June 2003 the appellant was managed conservatively - by medications of the anti-inflammatory and pain relief kinds, by physiotherapy, hydrotherapy, home exercises, occupational therapy and rest. She was referred for X-rays of her spine and right shoulder, and for ultrasound examination of her shoulder. In June 2003 she was referred by her general practitioner to a rehabilitation specialist, Dr Jenny Wood.

17 The upshot of the various investigations was that diagnosis was made of aggravation of pre-existing cervical spinal degeneration,[2] stress-related injury to the right shoulder,[3] generalised soft tissue injury affecting the neck, shoulder and arm, and lateral epicondylitis.

18 In the course of that 12 month period, the appellant began to complain of left shoulder and arm pain. She attributed its onset to having to use her left arm more because of the problems with her dominant right arm. She did not describe her left arm symptoms as they developed in that period, however, and has never since described them, as being as severe as those affecting her right arm.

19 Something more should be said about the period now under discussion. The appellant did not just give up work. She reported improvement in symptoms with treatment and rest, and three times returned to work on restricted duties. But on each occasion, she reported an increase in symptoms with an increase in activity. The medical records of the general practitioner, Dr Nesbit, which were put in evidence, the report of the physiotherapist, Ms Finnin, who treated the appellant for epicondylitis, and the various reports of the Commonwealth Rehabilitation Service ('CRS'), which was involved in the appellant's return to work attempts, are in my opinion contra-indicative of a woman who either threw in the towel or embarked upon a pattern of deceit.

20 One doctor examined the appellant on the respondent's behalf before she finally ceased work in June 2003. Dr Andrew Miller, an occupational health consultant, reported on 7 April 2003 that the appellant had sustained 'a chronic partially incapacitating injury to the neck, right elbow and forearm." The underlying pathology was 'a chronic strain of the common extensor origin of the right elbow and forearm extensors and a strain of cervical spine soft tissues.' The doctor expected 'further sustained improvement, with resolution of injury within six to eight weeks.' He considered her fit for restricted duties. Like Dr Nesbit, Ms Finnin and Ms Davy - the last-mentioned being the occupational therapist at CRS who played a part in the appellant's return to work attempts - he did not characterise the appellant as a fraudster.

21 Dr Miller never examined the appellant again.[4] His opinion was thus uninformed by all that followed.

22 I have said that Dr Nesbit referred the appellant to the rehabilitation specialist, Dr Wood, in June 2003. The appellant attended the doctor's rehabilitation unit over an approximate three month period. She was referred on for neurosurgical opinion. The neurosurgeon, Mr Han, arranged for an MRI of the appellant's cervical spine. He reported to Dr Wood that the investigation revealed degenerative change, especially at C6-7, but without evidence of compression of the spinal cord or significant nerve route impingement. He reported also that he did not consider surgery warranted 'given the relatively mild nature of the disc disease.' He recommended continued physiotherapy, and perhaps continuance of medication. He did not characterise the appellant as other than genuine.

23 In August 2003 Dr Wood reported to Dr Nesbit. It was, she said, still her opinion that the appellant's symptoms were caused by 'the C6-7 segment on the right.' She noted that 'there is no doubt that when [the appellant] works within her limits her symptoms can settle'; and that the appellant 'does seem to feel that she could manage the duties of a ward clerk.' She felt that it would be worthwhile seeking the opinion of a doctor skilled in pain management.

24 Dr Wood said nothing in her reports to Dr Nesbit, Mr Han and the Work Cover agent (with which she also corresponded), to suggest that the plaintiff was not genuine in her complaints. The same observation may be made in respect of the clinical notes of the rehabilitation unit, where again the pattern of variation in the reported severity of the appellant's symptoms, dependent upon the amount of activity engaged in, was noted.

25 The appellant continued in the care of Dr Nesbit after Dr Wood's role ended. In the latter half of 2003 she remained on medication for pain, undertook occupational therapy, and engaged in a gym programme. She continued to report a pattern of improvement and setbacks. Her main complaint was of pain rather than restricted movement.

26 In early 2004 the appellant began a basic computer course. This was in accordance with what had been recommended as part of her rehabilitation. She also continued on medication for pain, and continued to report variable symptoms.

27 Between 30 April 2004 and 13 September 2004 the WorkCover agent had the appellant examined by four specialists - two psychiatrists and two rheumatologists. The first psychiatrist, Dr Norman Rose, reported three times in 2004, his second and third reports commenting upon the reports of the rheumatologists Drs Karna and Kostos. Professor Richard Ball, the second psychiatrist, reported on 7 September 2004.

28 Dr Karna provided a supplementary report in April 2005. Dr Rose re-examined the appellant in 2007, and reported.

29 It is convenient to deal with the reports of Drs Rose, Karna and Kostos in one block; and then to refer to the opinion of Professor Ball.

30 Dr Rose reported, following his interview with the appellant on 30 April 2004, that she was 'suffering from a depressive reaction to her chronic pain.' There was 'no evidence that psychogenic factors [were] aggravating the pain.' He 'could find no pathological aggravation of pain', but the appellant was 'significantly depressed', this being 'a reaction to the pain and suffering caused by her physical injuries.' Overall, because of her pain and depression, the doctor thought that the appellant was unfit for any employment, and that she was 'likely to remain incapacitated for all employment so long as her pain persists.' He could not say how long she was unlikely to be fit for all work. There might be a small degree of permanent psychiatric improvement.

31 Then Dr Rose was sent the reports of Dr Miller (to which I have already referred) and the report of Dr Karna dated 21 May 2004. In the latter, Dr Karna opined that the appellant did have cervical degenerative changes, and that some degree of aggravation of the underlying disease 'may well have occurred in the work context.' But, he said, her 'portrayed incapacity' exceeded that which should be expected; and

the spreading nature of her problem, not responding to long absences from work, coupled with the superficial tenderness that she describes ... suggests that she has developed a super-added chronic pain syndrome ...

This syndrome was, he believed, 'psychogenically determined.'

prolonged absence from work and her psychogenically driven pain syndrome [were the] fundamental impediments to [the appellant] motivating herself in sustained gainful employment.

33 Before describing Dr Rose's response to that report, it is to be noted that Dr Karna was yet another doctor who - although he laid emphasis on psychogenic rather than psychological injury - did not question the appellant's bona fides.

34 Dr Rose, commenting upon the reports of Drs Miller and Karna, and having noted some disagreement between them, said this:

Patients with chronic pain which last beyond the expected time of recovery are notoriously difficult to assess. Often rheumatologists will give a diagnosis of fibromyalgia syndrome or they may say that the condition is psychogenic. Strictly, in accordance with DSMIV, any condition which is deemed to be psychogenically aggravated and in which the symptoms are beyond what might be expected from a physical injury alone, could be diagnosed as a pain disorder. Certainly Mrs Church has had mild depression and this may well have aggravated her pain. However, another possibility is that Mrs Church is by nature abnormally sensitive to pain and that it is her attitude to her pain which is governing her absence from work. In other words, it is more than possible that her absence from work is because of her intolerance of pain. Given that her pain is persisting, I find it difficult to say whether or not this persistence is organic or otherwise. If the persistence is not due to organic factors, then one would have to say that psychogenic factors are playing a part.

I am afraid that the only way of possibly resolving this issue might be to refer Mrs Church to yet another rheumatologist. I am aware that you have the opinion of Dr Karna but it would be interesting to see whether or not another rheumatologist would give a diagnosis of fibromyalgia syndrome. This whole case is somewhat puzzling.

35 In this Court, counsel for the respondent seized upon the words 'somewhat puzzling'. He suggested, as I understand it, that Dr Rose had been unable to settle upon a diagnosis. If that was the gist of the submission, I could not accept it in light of the doctor's later reports.

36 Next, Dr Kostos examined the appellant. By report dated 15 September 2004, he opined that he appellant 'has a chronic pain syndrome.' She did not have objective physical abnormality. There was 'no such condition' as 'soft tissue injury'.

Her chronic pain state is related to pain amplification and this is related to psychological and social factors, with the roles of inherent personality traits, previous life experiences and the adaptability to cope with anxiety and stress becoming increasingly appreciated.

Therefore the physical aspects of this woman's employment have not been a significant contributing factor to her presentation today.

38 The Doctor's opinion about the non-existence of a condition described as 'soft tissue injury' may be put to one side. At the very least, it was opposed to an assumption to the contrary which underlay other medical evidence adduced in this case.

39 For a different reason, I would place limited weight on the passage from Dr Kostos' report which I cited a moment ago. It travelled beyond his specialty and into the field of expertise of Dr Rose and of the other psychiatrists who provided opinions in this matter.

40 Dr Rose reported a third time, on 29 September 2004. He said this:

Having seen [Dr Kostos' report], I am now of the opinion that Mrs Church's pain disorder is psychogenic in origin. This means that she is suffering from a somatoform disorder. Pain disorder is one of the somatoform disorders. Somatoform disorders are notoriously difficult to treat because of the lack of insight in the patient and the patient's expressed belief that the symptoms are due to medical illness. The patient with this condition develops a fixed and entrenched belief that he or she is sick and that only medical treatment will cure the illness if any cure is possible.

You will note that in my report dated 3 May 2004 I expressed the belief that because of pain and depression Mrs Church was unfit for any employment and that she would remain incapacitated for all employment as long as her pain persisted. I remain of this view. I note that Mrs Church's symptoms are mainly those of pain and mild depression. Her psychiatric injury of pain disorder is secondary to a physical injury. Furthermore, I believe that impairment as measured by the specified method of psychiatric impairment in Victoria would be very low indeed.

41 In the last sentence of the passage just cited, Dr Rose was drawing attention to an anomaly in the application of the AMA Guides. He was not saying otherwise than that the [psychogenically driven] pain and the depression from which the appellant was suffering were wholly incapacitating.

42 Dr Rose reported again on 19 March 2007, having re-examined the appellant a few days earlier, having reviewed 39 reports of medical practitioners and allied health professionals and of medical investigations both relevant and irrelevant, and having read an affidavit of the appellant sworn 10 January 2003 and a draft statement of claim.

Mrs Church was a somewhat tense, healthy-looking 50-year-old woman with short light-brown hair. I noted that as she sat throughout the interview, she was supporting her right upper limb with her left hand. She was appropriately dressed and groomed and she was co-operative. There was no obvious exaggeration of pain. There was no grimacing or moaning.

Mrs Church has coped very poorly with her physical injuries. Because of her anxiety, she developed psychogenic aggravation of pain and symptoms of depression. She has been under treatment both by a psychiatrist and by a psychologist but she continues to have significant pain, which is aggravated by the least stress. Having gone to a Pain Management course has not helped her. For all practical purposes, her pain is now chronic.

(c) The prognosis is that given that almost 5 years have elapsed since the date of injury, Mrs Church's condition has stabilised and I do not expect any improvement or deterioration in the foreseeable future.

(f) Given that the original injury, which has been psychogenically amplified occurred in the course of employment, I believe that employment remains a significant contributing factor.

(g) All psychiatric impairment has arisen as a consequence of the physical injury.

44 Thereafter, it seems, the WorkCover agent sent Dr Rose a copy of the report of a treating psychiatrist, Dr Ryan, and a vocational assessment report compiled by a Ms Schneider. Dr Rose commented as follows:

1. I would suggest that Mrs Church's psychological condition can be only partially controlled by medication. Most patients with chronic pain and depression can obtain some relief from their depression with medication but because of the persistence of chronic pain, the medication will generally not be able to completely abolish symptoms of depression. I would therefore suggest that the psychological condition can be treated and partially controlled with medication.
2. There is nothing in the information that you have given me to change my mind about this woman's unlikelihood to return to any suitable employment. Even with treatment, it is unlikely that her health will be restored to a situation where she is capable of undertaking employment. This applies to both pre-injury and suitable employment.
3. Given Mrs Church's difficulties with medication, I cannot really say how much she will improve and over what time this improvement is likely to occur. All that I can be reasonably confident of predicting is that she will remain depressed and that she will continue complaining of pain for an indefinite period.

45 I note that Dr Rose observed the appellant supporting her right arm with her left hand at consultation in March 2007. It did not cause him to alter his opinion - specifically, to opine that her pain and her depression were other than real to her.

46 Dr Rose was not the only person to make such an observation. Ms Schneider did so at a consultation held on 13 March 2007. Although she also observed the appellant moving her right arm freely at one stage, she did not unequivocally question the subjective reality of the appellant's pain.

47 I mentioned earlier that the WorkCover agent had the appellant examined by a second psychiatrist, Profession Richard Ball, in September 2004. He was provided with the reports of Dr Miller and Karna. He reported, inter alia, as follows:

She did not use the right arm a great deal, but did pick up her X-rays on leaving the room with that arm. There was nothing bizarre about her appearance and presentation.

Her mood was depressed but responsive to variation in the content of the interview, and there was no pathological lability or incongruity.

There was no evidence of any perceptual anomalies, unless one gets onto the vexed question of pain threshold, and no evident cognitive impairment or other features suggestive of organic disorder.

Her problems with memory and concentration can be understood as secondary to her psychiatric state and drug intake.

She has some form of primary physical impairment, with secondary adjustment reaction with depression and anxiety. She is developing a chronic pain syndrome.

She could not be employed at the present time without some improvement of her perceived physical injury and physical limitations.

Issues of permanent impairment essentially relate to her alleged physical condition, not psychiatric.

48 The last-mentioned observation, I should say, is explicable if it was intended to convey the idea that the appellant's psychiatric well-being would be affected by improvement in her physical condition; and if it separated out the developing chronic pain syndrome from the diagnosed psychiatric condition of 'adjustment disorder with depression and anxiety'.

49 Returning to the chronology of the appellant's treatment, in the period between early 2004 and the hearing of the application she continued in the care of Dr Nesbit. She continued to receive medication for pain. She was referred to a psychologist, Ms Bilkey, in June 2004 and to a psychiatrist, Dr Ryan, in December 2005.

50 Ms Bilkey's clinical notes, for the period 22 June 2004 to 18 October 2005, reveal complaint of fluctuating levels of pain and depression. Ms Bilkey's report dated 5 April 2005 contains the following passages.

I believe that Ms Church is unable to return to work as she continues to experience pain and ongoing depression and anxiety. As is apparent in her MMP1-2 results she is exhibiting a number of behaviors that should have a negative impact on her ability to work. I note that her vocational assessment suggests that Mrs Church can do jobs such as ticket collector or usher in a theatre. It would seem apparent from her MMP1-2 results that she would not be suitable to do any tasks that would require her to have prolonged contact with the public or have to perform in a repetitive manner.

Although she is making some progress I would suggest that it is unlikely that she will be able to return to any form of work, until such time as there is a significant change in her level of pain, anxiety and depression.

As far as the depression and anxiety are concerned, this is improving because of the relaxation effect of the EEG. EEG Neurofeedback produces it's best results when it is performed two to three times a week. At the moment Mrs Church is attending sessions once a week and I have been encouraged by her results to date. I would like to increase her EEG sessions to twice or three times a week. Ms Church could require as many as 40 more EEG sessions to see any real change to her depression.

The worst thing for Mrs Church at the moment is stress. She can experience severe amounts of pain when her stress levels increase.

51 Dr Ryan reported to the appellant's solicitors on 15 December 2006. She had first examined the appellant in January 2006. At that time she had concluded that her patient had a major depressive disorder. She had recommended a variation in dosage of the appellant's antidepressant medication.

52 Further, according to the report, the appellant had attended Dr Ryan regularly until late May 2006, by which time the doctor felt that the appellant had made significant improvement, and had discharged her back to her general practitioner. But in November 2006 the appellant had been referred back to the doctor with re-emergent depression and anxiety, relevant stressors being her pain and the partly resolved ill-health of her husband. The doctor had changed the appellant's medication. By 12 December 2006 the appellant's mood had lifted somewhat, as the doctor perceived it; but that was not the appellant's perception.

I continue to be of the opinion that she has a Major Depressive Disorder with anxiety that has emerged in the past three months, and that this has developed subsequent to her work place injury, in direct response to the significant losses that I have outlined above. She has no previous psychiatric history that would indicate a predisposition to developing psychiatric illness.

Question 3 asks my opinion about the way in which the chronic pain condition impacts on her mental health and whether it manifests in itself the diagnosed condition that could be recognised as a permanent severe disorder. My view is that her pain has impacted on her mental health, leading to the development of a Major Depressive Disorder. Many people who have chronic pain and who develop a depression go on to have sustained depression, and there is a clear link between the pain the depression. For as long as the pain is present, the stressor leading to the depression is present and at best a partial response is achieved. Mrs Church did make a good response to active treatment of her depression, however this was not sustained and, in the absence of ongoing psychological support, she deteriorated.

This leads me to the opinion that we should be cautious about her prognosis in the future. For as long as she has pain, I anticipate that she will continue to have significant drivers to the depression and anxiety that are present at this point in time. She has, however, been able to make a good response to active treatment in the past and with sustained medical management provided by her general practitioner, specialist psychiatric input as is necessary and ongoing and continual psychological treatment, it is possible that she will achieve a significant improvement in her Major Depressive Disorder.

Question 5 asks me for an opinion as to whether or not her mental disturbance is likely to persist in the foreseeable future. I consider that it is.

54 Plainly, Dr Ryan was yet another doctor who found no reason to doubt the appellant's bona fides.

55 It remains to mention the reports of two further specialists from whom the WorkCover agent obtained opinion, and of one specialist who provided a medico-legal opinion at the appellant's request.

56 Dr Strauss, a psychiatrist, reported in August 2005, in part as follows:

This woman appears to be suffering from work related physical problems but to a significant extent psychological factors have become important in this case.

This woman has not coped with her chronic pain and disability and she remains angry with her former employer. She blames her employer for the development of her pain.

There is a psychological flavour to her presentation and in my opinion this woman has a pain disorder associated with anxiety and depression and employment is a significant contributing factor. No other factors appear to be relevant.

She presents as a woman with a pain disorder and anxiety and depression and her psychiatric problems are affecting her daily activities of living, social functioning, concentration and occupation.

57 Then there was Mr Brian Davie, orthopaedic specialist. Having seen the appellant on 23 October 2006, and having been provided with some job descriptions, he reported that:

I would think she could work as a ward clerk or admissions clerk, a hotel or medical receptionist, a general clerk or clerical assistant, also as a mystery shopper and console operator or cashier. I confirm that she is fit for this work and is not unfit for any work.

58 There could be no doubt, in my opinion, that in expressing the opinion Mr Davie stayed within the boundaries of his specialty.

59 Finally, there was the report of Mr Kenneth Brearley, surgeon, dated 19 November 2007. It was provided to the appellant's solicitors. His diagnosis was [work caused] aggravation of cervical degenerative disease, bilateral rotator cuff injury, chronic pain syndrome and continuing depression. He considered the appellant unfit for all work because of her depression, ongoing shoulder problems and chronic pain. As with the opinion of Dr Kostos, I would attach limited weight to Mr Brearley's opinion as to the existence, aetiology and extent of depression.

60 Before going to the appellant's evidence, I should say that I have read the many reports, plans, assessments and letters prepared by CRS and others in the field of rehabilitation and vocational assessment. It is unnecessary for me to refer to them seriatim. In my view they are compatible with the picture which emerges from the medical reports - of a woman who suffered physical injury at the outset, who made progress and returned to work only to have symptoms intensify, and who in time developed a pain syndrome and depression (and some symptoms also of anxiety). I would readily accept that jobs were identified in the documents which the appellant, from a purely physical standpoint, should have been fit to perform as time went by. But that says nothing about her capacity for work in light of her chronic pain syndrome and depression - assuming, for the moment, that she did suffer from those conditions.

61 The gist of the appellant's affidavit sworn 27 June 2006, as to symptoms, was as follows:

I have had persistent pain levels in my neck, right and left shoulders and right arm, from July 2002 onwards, with symptoms developing in my left arm since that time. My level of pain can become severe at times, and as such I have to be very careful in terms of the type of activities I undertake. To try and assist with pain control, I have taken regular medication since 2002, with a morpheine-based painkiller, Endep, having been introduced in to my regime from early 2004. The fact that I experience constant symptoms has a massive impact on my ability to function on a day to day basis. For example:

(a) I now have a weight lifting restriction of 5kg. Because of my restricted lifting ability, I no longer lift and carry supermarket shopping, rather I have my groceries home delivered;

(b) I now do smaller loads of washing and I use a washing basket mounted on a trolley, so that I do not have to carry the clothes basket to the clothes line. My husband has also lowered the outside clothes line so I only have to do minimal reaching when hanging out clothes;

(c) When doing day to day duties in the kitchen, I regularly need to lift objects such as pots, pans, crockery and foodstuffs. I am now restricted in lifting items that are relatively light in weight, or to lift items one at a time. Further, to minimise the amount of lifting I am exposed to, I have had a new wall oven installed so that I can work directly from the oven to bench height. Previously, I found that I could not lift items from the underbench oven up to the bench. The kitchen benches have also been adjusted in height to make the working height more comfortable for me;

(d) I do drive an automatic car, but I am limited to driving distances of about 30km. Fortunately, most of my medical treatment is provided in Echuca and on most occasions my husband drives me when I need to go out;

(e) I used to enjoy maintaining the garden. I can no longer push the lawn mower or work for any length of time with my arms extended or above shoulder height. My family now pays a gardener to mow the lawns and prune the trees;

(f) I have always taken pride in maintaining my own home and doing the day to day housework including cleaning, vacuuming and making the beds. I am now extremely limited in my ability to engage in any of these types of activities for more than very short periods of time. I can no longer turn a mattress. General cleaning around the house must be done, and I try to do what I can, however I find that any activity for any length of time exacerbates my symptoms of pain. I have been provided with home help for one hour per week over the past 3 years to assist with the more strenuous items;

(g) I no longer get a full night's sleep. If I roll over on to my right shoulder in particular, it causes me to wake up. I estimate that I average about 4 to 5 hours sleep each night. I now take 2½ Avanza tablets each night to help me try and sleep;

(h) I have put on about 2 stone in weight since mid 2002. I attribute this directly to the fact that I am nowhere near as active as I was when I was working;

(i) I am right handed and as such my injury has had particular impact on my right arm. This has resulted in a massive impact on my day to day activities. I find it particularly frustrating that I cannot engage in active play with my grandchildren. Like all small children, they often want to be picked up and this is something that I cannot do. I can really only interact with my grandchildren when I am sitting down;

1. THAT in addition to the physical injuries to my neck, shoulders and arms, I have also suffered significant psychological upset, which I attribute to the fact that I now live with chronic pain symptoms, and also as a result of the impact of my injuries on all aspects of my day to day life.

And

(a) I have lost significant confidence and self esteem as a result of my inability to work. I believe I had a strong work ethic, and have always enjoyed both the manual and social aspects of employment. Now that I am not at work, I feel socially isolated;

(b) I am constantly frustrated by the physical limitations caused by my injuries. I do not consider that I am fulfilling my role as a wife, mother and grandmother, both in terms of the range of activities I can do around the house and in terms of providing support to my other family members and friends. I am often tearful, as the fact that I cannot do my normal daily household duties causes me to become more upset and more depressed;

(c) I find that I am tired and listless, part of which may be a result of the medication I take;

(d) I have a low libido and this combined with general mood swings associated with my pain symptoms, has a direct impact on my relationship with my husband. Although he is very supportive, our relationship does become strained at times.

62 Viva voce, the appellant said that medication helped her pain, which was never below 6 on a scale of 1 - 10, and which when it was bad was 9 - 10. When the pain was bad, she would be laid up for days. She was taking both prescribed and over the counter medications. She was still seeing the psychologist, Ms Bilkie because, if the latter's support was withdrawn, she tended to go downhill. She was still attending Dr Ryan. Her medication for depression had been changed again in 2007. She did not think she could do any work, because of pain. She did not like being around people. She saw no future for herself. On the day of her hearing she was:

Really bad with pain because of the travel and because of the stress of the last few days.

63 As to travel, it emerged that in the three days culminating in the day of the hearing she had travelled from her home in Echuca to Shepparton, to Bendigo (it had to do with her husband's health), and again to Shepparton (for the hearing). That seems to have involved much more in the way of travel that she had been accustomed to engage in after mid-2002.

64 Counsel for the respondent, in cross-examination, made a concerted effort to get the appellant to give an exaggerated account of her disabilities; and to give an account of what she could and could not do which stood in contrast to what was shown in her surveillance films. I consider, however, that the appellant largely accepted that she could do, and had done, the various activities which were the subject of cross-examination, though putting her performance of such activities in context. The following questions and answers illustrate the kind of attack which was made, and the appellant's response:

So you can't go shopping because you can't lift anything?---I do go shopping.

Who lifts the stuff up when you go shopping?---I do.

I thought you told Dr Ryan that you couldn't lift goods when in the supermarket, you had to ask a staff member for assistance?---If it's high I have to, yes.

That must be difficult if your arms are, as you've indicated to His Honour, in the fashion that you are holding them at the moment?---And why would that be?

You told His Honour before that your usual state was as you're portraying it to us physically at the moment, that is, your left arm cradling your right?---Yes. I go, I do the shopping, I get it home delivered. I've never said I never do the shopping. There's things I can do, there's things I can't do.

All right. Are you able to, for example, reach behind yourself like that, couldn't you do that?---No.

Couldn't do that?---No.

How do you put the seat belt on in the car?---Pull the seat belt across.

Do you, all the time?---Yes.

Okay. And your neck, how do you go in the car with your neck? How do you turn around and see what's behind you, or don't you?--- I use my mirrors.

So you don't turn around?---Yes, I've turned around in the car.

Well, as a matter of practice do you turn or do you use the mirrors, what do you do?---I use the mirrors.

Right. So it would be exceptional for you to turn around?---What do you mean exceptional?

It would hardly ever occur. More often than not you'd always use your mirrors and only in an exceptional circumstance, once out of 100 you'd turn around?---No, I can turn around and look out, not a problem.

And you do it like that, by moving your whole body, not by moving your head on top of your shoulders?---Yes, I can do that.

By moving your whole body?---Most of the time.

Not your head on top of your shoulders?---Yes, most of the time.

And that would be because the pain would prevent you from rotating your head turning your neck and looking over your shoulder, for example?---Well, I do do that. Of course I've done that. I've turned my head and I'm in pain all the time.

But what, you just forget about the pain from time to time?---No, you don't forget about the pain. You do it and then you know you've done it. The pain clicks in. The pain's there, you've done it.

What about sitting down having lunch, would you be able to do that?---Yes.

Would you be able to eat using both hands?---Yes.

Would you be able to eat say a hamburger or something like that using both hands?---Both hands, yes.

Holding it in a fashion like this and putting it to your mouth and taking a bite?---Yes.

How would your right arm cope with that?---Easy. As long as I'm not holding my hand up to too long I can do that and it's supported by my breast, no worries.

AND

Would you be able to walk around a store for example carrying a box under your left arm and get items out of shelves with you right, could you do that?---Yes.

You could do that. How could you do that with the unremitting pain that you've described?---I just do it.

You just do it. So we would see you in absolute agony presumably undertaking that manoeuvre?---Yes.

Would you be able to lift your right arm up like that and hold it there for some time? Right arm, no, no, not that sort of - right arm, like that, would you be able to do that?---Yes.

But as slowly as that, you'd have to obviously take great care to - - -?---I can put it up, yes.

Yes, but you'd have to do it slowly and in great care?---No, I can do it but it hurts.

65 Thereafter, in course of cross-examination, the surveillance films were shown to the appellant, and she was asked questions about what was depicted. The judge below described his perception of the films, the content of which he outlined only briefly, this way:

On the occasions when the plaintiff was observed in the films put to her, it seemed to me that she was moving her neck, shoulders and right arm freely and without restriction. She was seen picking things from shelves in shops, getting into and out of her car, putting bags of shopping into the boot of her car, driving her car and eating without apparent restriction.

66 I have watched the films. Quite apart from their intrinsic content, they had a contextual setting. I should describe both the context and the content.

67 First, there are four films in all. Their total running time is less than one hour. In two of the films there are multiple sequences, taken at different times of the day, though only amounting to a few minutes in all. The fourth film, for instance, taken on 19 August 2007 comprises four short sequences taken variously between about 10.40 am and about 4.45 pm. On that day, according to admissions made by the respondent, the appellant was under surveillance between 7 am and 5 pm.

68 Second, the films were taken on 9 September 2006, 11 December 2006, 16 March 2007 and 29 August 2007. On 9 September 2006, according to the respondent's admissions, the appellant was under surveillance between 8 am and 1 pm. On 11 December 2006, when two minutes of film was taken, the appellant was under surveillance between 7 am and 1 pm. On 16 March 2007, when about nine-and-a-half minutes of film was taken, the appellant was under surveillance between 6.30 am and 2.30 pm. I have already referred to the relationship between the total period of surveillance, and the amount of film taken, on 19 August 2007.

69 Third, the appellant was subjected to surveillance on 22 occasions between 8 September 2005 and 19 August 2007. The respondent's admissions did not disclose the number of hours of surveillance on every one of those occasions, but often it was admitted to have extended for a substantial part of the day. Two possibilities arise: first, that more film was taken, but was not shown. Second, that the appellant was not seen at all, or not seen doing anything thought to warrant filming, on all those other occasions. It can at least be said that periodic surveillance of the appellant over an extended period, for many hours, generated no observation in reliance upon which (the four films apart), whether by film or viva voce evidence, the respondent sought to contend that the lie was given to the appellant's alleged symptoms and restrictions on activity.

70 Fourth, the film recorded on 9 September 2006 was mainly taken inside two shops. It is of appalling quality. Infrequently, it depicts the appellant. She is shown on two occasions lifting her right arm to shoulder height, and once above shoulder height. Other than that, she is shown walking to her car and reversing it. I accept that, insofar as the appellant is shown on the film, she walks normally - which was never in dispute - and that she uses her right arm on a few occasions with apparent freedom.

71 Fifth, the film taken on 11 December 2006, of about two minutes' duration, depicts the appellant walking, putting her hand to her hair, getting out of the passenger side of her car, talking to someone, getting into the driver's side of the vehicle, and reversing it. Such actions as the applicant performs, I should say, are essentially inconsequential.

72 Sixth, the film taken on 16 March 2007 depicts the appellant and her husband sitting at a table outside a café eating what was described in cross-examination as a hamburger. She uses both hands to lift the item to her mouth. Other than that, she is seen turning her head to the right, wiping her face, depositing two serviettes in a bin, and driving away.

73 Seventh, the film taken on 19 August 2007 depicts the appellant walking, with a bag in her left hand. Having got into a motor vehicle she uses her right hand to fit the seatbelt. She goes into a supermarket and later emerges with a trolley of foods. Later in the day she is depicted watching a man putting something into a barrow. Perhaps she also puts something into the barrow.

74 Eighth, my overall impression is that the films reveal a woman engaging in mundane, physically undemanding tasks for short periods. She is depicted, for the most part, by herself. I accept that she uses her right arm with apparent freedom on the relatively few occasions that she particularly uses it. It is also apparent that on a few occasions she drives the car despite her husband being present.

75 Ninth, the cross-examiner pressed the following matters upon the appellant:

• That in the first film she had moved her head to the right quite freely. The witness agreed that she could do that.

• That in the supermarket the appellant had looked as if she was moving pretty well. The witness said that there were things she could do and things that she could not.

• That in the first film she had extended her right arm into the shelves, and that she had held her arm up. The witness replied that she had never said that she could not hold her hand up.

• That she did not look like a woman with significant pain in doing what she did in the first film. The witness said that she had been in pain.

• That her presentation in court, cradling one arm in the other, contrasted with what was depicted in the first film. The witness replied that 'Today is a big pain day'.

• Referring to the second film, that she had fitted the seatbelt in a way which she had earlier denied she could do. The appellant responded that there was no such contradiction in her evidence.

• Referring to the third film, that she had (whilst walking) moved her head up and down in a full and unrestricted fashion. The witness agreed.

• That she had been able to use both hands to lift her hamburger to her mouth and eat it. The appellant replied that her elbows had been resting on the table.

• That she had driven the car, although her husband had been present. The witness agreed.

• Referring to the fourth film, that she had done a 'full shop' and that she had fitted the seatbelt in a way which she had said she could not do. The witness agreed with the former proposition, but disagreed with the latter.

76 Re-examined, the appellant said that she, rather than her husband, had driven the car on one occasion because he was not well. She also expanded upon why the day on which she was giving evidence was a 'big pain day' - that is, by explaining the three trips which she had made as consecutive days to Shepparton, Bendigo and Shepparton again.

77 I have set out the cross-examination of the appellant directed to the films in considerable detail for two reasons: first, because it seems to me that the appellant gave sensible answers, consistent with her case, in nearly every instance. Second, because the questions themselves revealed the essentially inconsequential nature of what the films depicted.

78 The reasons for judgment follow a pattern which is very recognisable in the case of the particular judge. His Honour framed the appellant's case and the defence, this way:

The plaintiff has alleged that, arising out of or in the course of or due to the nature of employment with the defendant, she has suffered permanent serious impairment or loss of the body functions of her neck, shoulders and arms (the 'paragraph (a) claim').

The plaintiff has also alleged that, arising out of or in the course of or due to the nature of employment with the defendant, she has suffered a permanent severe mental or permanent severe behavioural disturbance or disorder in the form of a chronic pain syndrome and a major depressive illness with anxiety (the 'paragraph (c) claim').

Through her counsel, Mr Jewell, the plaintiff indicated that she relied more on her paragraph (c) claim rather than her paragraph (a) claim.

Further, the plaintiff claims to be entitled to leave under s 134AB(16)(b) of the Act on the basis that she has suffered both pain and suffering and loss of earning capacity consequences as a result of the physical impairment and mental disorder claimed.

The defendant has denied that the plaintiff is suffering from a 'serious injury' as defined. As I understood the defendant's position, it was put that the plaintiff's case did not satisfy the statutory test under either paragraph (a) or paragraph (c) of the definition of 'serious injury' in that the consequences from which she allegedly suffered were neither 'serious' nor 'severe'. Further, the defendant had concerns about the plaintiff's credibility.

It was not disputed by the defendant that the plaintiff had suffered compensable physical injury to her neck, shoulders and arms.

79 Then his Honour set out passages from the appellant's affidavit. He said nothing about cross-examination, or what he made of the appellant's responses.

80 Next, his Honour recited a good deal of Dr Nesbit's report to the WorkCover agent dated 25 January 2006 and Dr Ryan's report dated 15 December 2006. He prefaced these passages by observing that, at the outset, 'there was no obvious organic injury in the [appellant's] presentation', for which reason she was 'started ... on the usual range of conservative treatment and medication for a soft tissue injury'.

81 If his Honour meant to imply that no physical injury had been sustained by the appellant in compensable circumstances at the outset, then not only was this in direct conflict with the concession made by the respondent and previously noted by his Honour, it was at odds with the opinions of at least Dr Nesbit, Dr Wood, Mr Han, Dr Karna and Mr Brearley. It was also at odds with the thesis developed by each of Dr Rose, Professor Ball, Dr Strauss and Dr Ryan.

82 Then his Honour turned to the medical material relied upon by the respondent. He said this:

The medical opinions relied on by the defendant are to the general effect that the reporting practitioners were unable to find any organic cause for the plaintiff's continuing symptoms and that her pain syndrome, however described, was not caused by her employment with the defendant. From a psychiatric point of view, Dr Rose, consultant psychiatrist, examined the plaintiff on behalf of the defendant's insurer and in a report dated 27 September 2004 he relevantly said:

'Thank you for the report from Dr Tony Kostos which confirms the opinion of Dr Roy Karna that there is no objective physical abnormality. As you recall, in my opinion supplementary report dated 23 August 2004, I suggested referral of Mrs Church to another rheumatologist and I did say that if another rheumatologist expressed the opinion that the worker's physical symptoms were not organic I would have to say that she has a psychogenically determined pain disorder.

Having seen this new evidence, I am now of the opinion that Mrs Church's pain disorder is psychogenic in origin. This means that she is suffering from a somatoform disorder. Pain disorder is one of the somatoform disorders. Somatoform disorders are notoriously difficult to treat because of the lack of insight in the patient and the patient's expressed belief that the symptoms are due to medical illness. The patient with this condition develops a fixed and entrenched belief that he or she is sick and that only medical treatment will cure the illness if any cure is possible.

You will note that in my report dated 3 May 2004 I expressed the belief that because of pain and depression Mrs Church was unfit for any employment and that she would remain incapacitated for all employment as long as her pain persisted. I remain of this view. I note that Mrs Church's symptoms are mainly those of pain and mild depression. Her psychiatric injury of pain disorder is secondary to a physical injury. Furthermore, I believe that impairment as measured by the specified method of psychiatric impairment in Victoria would be very low indeed.'

83 That summation was, with respect, erroneous. It is simply not the case that the 'general effect' of the medical opinions for the respondent was that the appellant's pain syndrome, however described, was not caused by her employment with the defendant. The general effect - Dr Kostos stood apart - was to the contrary. Further, if his Honour meant to imply, by setting out a little of Dr Rose's report dated 27 September 2006, that Dr Rose held that opinion, then, with respect, he misunderstood the import of the doctor's opinion - an opinion which he restated in 2007.

84 A part explanation for the learned judge's summation lies, I think, in his later expressed opinion, which in my view involved a misunderstanding of the law, that the dominant cause of a para (c) injury must be 'the employment' - this having the effect of excluding an injury, otherwise within para (c) of the definition, 'secondary to or as a consequence of' compensable physical injury. The respondent rightly made no submission to that effect on the hearing of the application, or in this Court.

85 His Honour then stated that 'given the conclusions [he had] reached, [he] believe[d] that further rehearsal of the medical evidence [was] unnecessary'. This was the lead-in to his findings about the appellant's credibility.

86 I have already set out the passage in his reasons in which the judge referred to the impact of the surveillance films. But in light of criticisms made in this Court of his Honour's reasons, I should set out a more extensive passage:

[T]he plaintiff was shown video and DVD surveillance films taken on 9 February 2006, 11 December 2006, 16 March 2007 and 19 August 2007. In response to a request from the plaintiff's legal advisers, the defendant admitted, ... that it had arranged surveillance of the plaintiff on 20 other occasions between October 2004 and August 2007. On the occasions when the plaintiff was observed in the films put to her, it seemed to me that she was moving her neck, shoulders and right arm freely and without restriction. She was seen picking thing from shelves in shops, getting into and out of her car, putting bags of shopping into the boot of her car, driving her car and eating without apparent restriction. This contrasted to the plaintiff's evidence in her affidavit, to medical practitioners and in court.

In my view, the plaintiff's demeanour in court is of particular significance. During the time she gave her evidence, which spanned approximately 1 hour and 40 minutes, the plaintiff cradled her right arm with her left arm as if it were in a sling. She said that she did so because it was a "big pain day" for her. In response to Mr Blanden's questions about the apparent lack of restriction in the surveillance films, the applicant claimed that they must have been "good" days for pain.

It is perhaps trite to say that when claimants are being assessed by medical experts and others in relation to the nature and extent of injuries they allege they have suffered, the compensation system at every level relies on accounts which are, subject to acceptable limits in relation to human frailty, frankly and accurately given. When the physical injury claimed is, as here, one for which there is no organic explanation, it seems to me that the burden on the claimant to be frank is a high one. Likewise is the case where the injury claimed is an emotional one which is not capable of objective verification.

Unfortunately, after comparing the plaintiff's claimed incapacity in the witness box, including the other evidence in the case, with the way she moved in the surveillance films, I am unable to accept her as a credible and reliable witness. In coming to that conclusion, I accept that the films were taken over a 16 month period five years after the plaintiff allegedly suffered injuries which she has claimed, and continues to claim, have precluded her from working and living a normal life since 2002.

87 That was evidently the basis upon which Honour dismissed the application. But, to complete the picture, he said that he would in any event have rejected the paragraph (a) claim because the appellant had failed to strip out or disentangle the psychological or psychiatric consequences of injury as 'required by' s134AB(38)(h) of the Act;[5] and that he would have rejected the paragraph (c) claim because the 'dominant cause' of the psychological or psychiatric injury was not the employment, but rather the physical injury. That is, the employment had not been 'a direct cause' of the appellant's medical disorder. He added:

[I]t was not put on behalf of the plaintiff, as I understood it, that it was her depressive or anxiety disorders which prevented her from working and otherwise enjoying her life but rather the pain and restriction of movement in her neck, shoulders and arms. Absent those physical conditions, it was not suggested that the plaintiff's depressive or anxiety disorders were causing those consequences.

88 I have already commented upon what seems to me to have his Honour's misapprehension concerning the 'dominant cause' of paragraph (c) injury. It remains to add, for sake of completeness, that the gist of the medical evidence was that the appellant's chronic pain syndrome, whatever had provoked it, was a distinct somatoform disorder. Disappearance of the original stimulant, let it be assumed, did not mean that the somatoform disorder would disappear.

89 By s 134AE of the Act, the judge was obliged to give reasons 'which are as extensive and complete as the Court would give on the trial of an action'.

90 The application of the duty to give reasons has often been described. A concise example is what was said by Nettle JA in Hunter & Transport Accident Commission and Anor[6]. It is important that reasons expose a path of reasoning. Failure to expose the path of reasoning is an error of law. If reasons fail in that respect, the losing party is left to wonder why the case was lost.

91 Reasons should be read as a whole. Their adequacy or otherwise must be assessed in light of the issues which were litigated.[7] That is why the disposition of one case will not necessarily provide the answer to complaint about inadequacy of reasons in another case.

92 An appeal in which complaint is made about inadequacy of reasons is governed by s 74(1) and (3) of the County Court Act 1958. As explained by the High Court in Dwyer v Calco Timbers Pty Ltd[8] the issue is not one which calls s 134AD of the Act into play.[9] It follows that error must be established; and, if it is established, then this Court may - not must - remit the application for rehearing. Whether it does so will depend upon whether the Court considers itself as well placed as the judge below to decide the matter itself.[10]

93 In the present case, it appears to me that his Honour's disposition of the application by reference to the appellant's want of credibility left large portions of the relevant evidence unremarked. In the event, the reasons for judgment do not disclose a clear the path of reasoning. The following circumstances are pertinent.

94 First, his Honour regarded the appellant's conduct in cradling one arm in the other whilst giving her evidence as being of 'particular significance'. He contrasted this behaviour with the 'apparent lack of restriction' said to be evident in the surveillance films. He noted the appellant's explanation that the day of hearing was a 'big pain day'. If he accepted that evidence - he did not say whether or not he did so - then the contrast which he discerned was not what it seemed. If he did not accept such evidence, then why? He did not say. It was not in debate that the appellant had done a lot of travel, for her, in the days leading up to the hearing of the application.

95 Second, the appellant's evidence that she suffered more pain after extended travel was consistent with the history which she had provided to a number of doctors. Nothing was said by his Honour about those histories, which supported an inference that the appellant was likely to have perceived her pain level on the day of the hearing to have been high.

96 Third, as I have noted earlier, Dr Rose had noted the appellant cradling one arm in her other. It had not caused him to conclude that the appellant was other than genuine in her perception of disabling pain. Likewise, Ms Schneider.

97 Fourth, the judge made no reference at all to the oft-recorded history given by the appellant of variation in symptoms. He did refer to the appellant having 'claimed' that the days on which the film was taken must have been 'good' days for pain. About that 'claim', he said this:

Unfortunately, after comparing the plaintiff's claimed incapacity in the witness box, including the other evidence in the case, with the way she moved in the surveillance films, I am unable to accept her as a credible and reliable witness. In coming to that conclusion, I accept that the films were taken over a 16 month period five years after the plaintiff allegedly suffered injuries which she has claimed, and continues to claim, have precluded her from working and living a normal life since 2002.[11]

98 That conclusion, notably, failed to address the potential significance of the respondent 'having arranged surveillance of the appellant on 20 other occasions between October 2004 and August 2007'.[12] His Honour said nothing about the small quantity of films which was produced despite there having been many hours of surveillance over many days. I agree with the submission of counsel for the appellant that this circumstance was relevant in his client's favour - regardless whether other film had been taken but not shown, or whether other film had not been taken because it was not warranted, or because the appellant had not been observed doing anything. I put aside the possibility that the appellant had been observed doing something which impugned her case, but that it had been impossible to take film of it. There was simply no evidence to suggest that such was the case.

99 Fifth, the judge referred to a contrast between, on the one hand, what was shown in the films and, on the other hand, the evidence given by the appellant by affidavit, viva voce, and in what she said to medical practitioners. He expressed the contrast in very general terms. In my opinion, a good deal more was required. For the appellant's oft-repeated history of variable symptoms, and her evidence that she did do things but it hurt, by no means established a contrast with the relatively few activities, undertaken for short periods, depicted on the films. Neither did the films cast any doubt on the appellant's account of her restricted activities in and about her home.

100 Sixth, it is notable that the films were not shown to any of the doctors who had interviewed and examined the appellant on the respondent's behalf.[13] As counsel for the respondent readily conceded in this Court, that is often done. It provides an opportunity for medical men to contrast the patient whose history was taken, or who was examined, with the person depicted in the film. It was arguably significant that no such opportunity was given in this case. No doctor had labelled the appellant as being other than genuine. Their opinions stood. The judge explained the opinions away by holding, in effect, that the appellant had not given frank and accurate accounts to the doctors. But whether any of the doctors would have expressed such a conclusion, having been shown the films, is speculative.

101 Seventh, counsel for the respondent submitted in this Court that there was evidence before the judge which authorised his Honour's conclusion that the appellant was an unreliable witness. Accepting, for purposes of argument, that this was so, it is no response to the ground of appeal now under discussion. The question is not whether there was evidence to support an intermediate or an ultimate conclusion , but whether the reasons adequately demonstrate a path of reasoning through the strands of the evidence to such conclusions.

102 Although the judge below decided the matter by finding that the appellant was an unreliable witness, the bases upon which his Honour did so are patent. He contrasted the appellant's evidence and the accounts which she had given to the doctors with the appellant's presentation on the surveillance films; and he perceived a contrast between her presentation on those films and her cradling of one arm in the other whilst giving her evidence. He described the cradling, and its duration, quite clearly. He did not identify any other aspect of the appellant's evidence, or the manner in which she gave it, as bearing upon his assessment of her reliability. He referred to no circumstance which this Court would or might have difficulty in assessing - a hesitancy in answering questions, for instance, or an apparent looking to counsel or some other witness for help.

103 In the event, I consider that this Court is as well-placed as was the judge below to decide the application. Focusing only upon my conclusion that the reasons for judgment were impermissibly inadequate, I consider that the task should be undertaken.

The correct approach to determining whether serious injury has been sustained.

104 Counsel for the respondent submitted that the effect of Dwyer v Calco Timbers Pty Ltd[14] is that, whenever there is a challenge to a finding of serious injury, it is unnecessary for the appellant to demonstrate error. Rather, it is for this Court to decide the issue of serious injury for itself, in reliance upon 'the evidence and other material before the judge who heard the application' and any other evidence which the Court may receive.[15]

105 That submission should be accepted. Whilst what the High Court said in Dwyer at [32] and the first sentence of [33] might be read as requiring only that this Court decide for itself the question of serious injury in the event that error is demonstrated - that is, as excluding the option of remitter for rehearing which would otherwise be available under s 74(3) of the County Court Act - the analysis at [47] has the effect of excluding a need to show error before s 134AD is engaged. The same may be said of the reasons at [48]-[50]. Their Honours' reference at [50] to centralising the ultimate decisions on 'serious injury' matters to the Court of Appeal strongly implies that this Court must consider each contested serious injury question for itself, demonstrated error not being a prerequisite for doing so.

106 Next, in deciding for itself whether the injury is serious injury, this Court should do so bearing in mind the onus resting upon the applicant. What ever may be the linguistic difficulties of reading s 134AB(16)(b) and (19)(a) as applying to a determination of serious injury by this Court, they should be read to apply, and with the consequences specified by s 134AB(19)(c). The parties did not argue the contrary.

107 Further by s 134AD, this Court must determine the serious injury question 'on the evidence and other material before the judge who heard the application'.[16] 'Evidence' should be understood in the traditional sense, I think, because of the contrast with 'other material'.

108 The possible content of the latter was debated. It was suggested that it might be an intended reference to receipt of material in non-evidentiary form pursuant to s 44(1) of the Act - which assumed the applicability of that provision to applications under s 134AB(16)(b). A second suggested possibility, akin to the first, was that reference to 'other material' was intended to authorise the use of evidence in a different or additional way to that in which it could conventionally be used. So it was posited, it could authorise the use of a history given to a doctor as evidence of the fact rather than simply as part of the basis for the expression of medical opinion; or as an admission against interest. A third possibility which was canvassed was that 'other material' could pick up an observation made by, and remarked upon, by the judge hearing the application - something bearing upon assessment of a witness's demeanour. Such an observation would be 'before' the judge, albeit that it was only recorded in his or her reasons for judgment.

109 It is unnecessary in this case to resolve the debate. It is enough to say that the circumstances which I have described as the third possibility would seem to fall within the description of 'evidence'.

110 The third possibility, by focussing upon the word 'before', directs attention to the distinction between what is before a judge and the judge's reasons for judgment. It cannot sensibly be said that the latter are part of the material 'before' the judge. Nevertheless, in Dwyer the High Court referred[17] to this Court being required 'with the assistance of what should be detailed reasons of the County Court, to decide for itself whether the injury is a "serious injury" and to do so on the evidence and material before the primary judge'.

111 Since, subject to receipt of further evidence, this Court must decide the critical question on the evidence and other material which was before the judge, since the judge's reasons are not themselves part of that material, and since error is not a condition precedent to this Court deciding the critical question, what assistance could be gained from detailed reasons?

112 I should say that this Court could be assisted in at least two ways. In the first place, a judge's reasons would be likely to assist this Court if they analysed the evidence in an ample and logical way; not because to do so would absolve this Court of its fact-finding obligation, but because it would enable the parties to identify matters of common ground and where the area of debate begins; and because ample and logical reasons would provide very useful signposts to this Court in carrying out its task.

113 In the second place, it seems to me that reasons would be of assistance if they described any matter observed in court which, to the judge's way of thinking, bore upon a witness's credibility.

114 That second matter serves as an introduction to a further submission made for the respondent: that 'as to findings below based upon the credit of witnesses and in-court observations as to demeanour ... the long established principles of appellate caution may be applied and are conformable with s 134AD and the reasons in Dwyer.' According to the submission, the principles enunciated in Fox v Percy[18] apply.

115 In describing the function of an appellate court, counsel referred to parts of what was said in the joint judgment of Gleeson, CJ, Gummow and Kirby JJ in Fox v Percy at [23], [25] and [29]. The passages upon which counsel relied were these:

On the one hand, the appellate court is obliged to "give the judgment which in its opinion ought to have been given in the first instance.". On the other, it must, of necessity, observe the "natural limitations" that exist in the case of any appellate court proceeding wholly or substantially on the record. These limitations include the disadvantage that the appellate court has when compared with the trial judge in respect of the evaluation of witnesses' credibility and of the "feeling" of a case which an appellate court, reading the transcript, cannot always fully share.[19]

Within the constraints marked out by the nature of the appellate process, the appellate court is obliged to conduct a real review of the trial and, in cases where the trial was conducted before a judge sitting alone, of that judge's reasons. Appellate courts are not excused from the task of "weighing conflicting evidence and drawing [their] own inferences and conclusions, though [they] should always bear in mind that [they have] neither seen nor heard the witnesses, and should make due allowance in this respect"[20]

In particular cases incontrovertible facts or uncontested testimony will demonstrate that the trial judge's conclusions are erroneous, even when they appear to be, or are stated to be, based on credibility findings.

That this is so is demonstrated in several recent decisions of this Court. In some, quite rare, cases, although the facts fall short of being "incontrovertible", an appellate conclusion may be reached that the decision at trial is "glaringly improbable" or "contrary to compelling inferences" in the case. In such circumstances, the appellate court is not relieved of its statutory functions by the fact that the trial judge has, expressly or implicitly, reached a conclusion influenced by an opinion concerning the credibility of witnesses. In such a case, making all due allowances for the advantages available to the trial judge, the appellate court must "not shrink from giving effect to" its own conclusion. Finality in litigation is highly desirable. Litigation beyond a trial is costly and usually upsetting. But in every appeal by way of rehearing, a judgment of the appellate court is required both on the facts and the law. It is not forbidden (nor in the face of the statutory requirement could it be) by ritual incantation about witness credibility, nor by judicial reference to the desirability of finality in litigation or reminders of the general advantages of the trial over the appellate process.[21]

116 Counsel submitted, in support of his broad proposition, that -

(a) It would be a 'revolutionary step'[22] to reject the application of those principles.

(b) This Court was able to decide the critical question for itself whilst adhering thereto.

(c) The principles require only that 'due allowance' be afforded to the trial process.

(d) In Dwyer, the High Court referred to the advantages enjoyed by the trial judge, and to the potential for serious injury applications to be affected by credit issues. It did not suggest that Fox v Percy principles were not relevant.

(e) In Dwyer, the High Court did not reject the proposition, stated by this Court in Dwyer, that 'the appeal court must recognise and give appropriate weight to the advantages of the trial judge, who has seen and heard the witnesses'.

(f) The proposition that the Court of Appeal should not defer to the outcome below did not mean that it should not make due allowance for the trial judge's advantage in assessing the credit of witnesses and in finding facts based upon that assessment.

(g) In the present case, the relevant finding as to credit was influenced by the appellant's in-court demeanour, a circumstance particularly within the province of the judge who heard the application. Other than that, analysis of the evidence before his Honour showed that his adverse finding as to the appellant's credibility was not 'glaringly improbable' or 'contrary to compelling inferences.'

117 In my opinion, counsel's submission failed to distinguish between the different functions of this Court in an appeal to which s 134AD of the Act applies and the function of a court entertaining an appeal by re-hearing of the conventional kind which was considered in Fox v Percy.[23] There, Gleeson CJ, Gummow and Kirby JJ pointed out that the nature of the re-hearing shaped the requirement and limitations of such an appeal. They pointed out that the disadvantages for an appellate court include the fact that such a court typically does not get taken to, or read, all the evidence at trial; and that the trial judge commonly has 'advantages that derive from the obligation at trial to receive and consider the entirety of the evidence.'[24] They said also that, given the continuing importance of the reminder 'of the limits under which appellate judges typically operate when compared with trial judges'

... that instruction did not, and could not, derogate from the obligation of courts of appeal, in accordance with legislation such as the Supreme Court Act applicable in this case, to perform the appellate function as established by Parliament. Such courts must conduct the appeal by way of rehearing. If, making proper allowance for the advantages of the trial judge, they conclude that an error has been shown, they are authorised, and obliged, to discharge their appellate duties in accordance with the statute.[25]

118 What their Honours said, in the passage last cited, emphasises that, in a conventional appeal by way of re-hearing, error must be demonstrated before the appellate court is authorised to intervene. But in Dwyer v Calco the High Court held that it is not a prerequisite for the obligation of this Court to decide for itself whether serious injury was sustained in any particular case that error be demonstrated in the decision at first instance. It recognised, at least implicitly, that an appeal governed by s 134AD is 'a wholly novel procedure', or at least a variant of one or more of the four categories of appeal described in Fox v Percy.

119 It seems to me to follow, as a matter of principle, that this Court must equally put aside both the ultimate decision below and findings of fact along the way to that decision; and that it is not a question of this Court only allowing an appeal if 'incontrovertible facts or uncontested testimony .. demonstrate(s) that the trial judge's conclusions [were] erroneous', or if 'the decision at trial [was] "glaringly improbable" or contrary to compelling inferences'.[26]

120 But notwithstanding that approach, can it be the case that a particular kind of finding - either an assessment of credibility, or a finding dependent upon an assessment of credibility - is to be quarantined in some way from the generally applicable situation?

121 It is true that the High Court in Dwyer referred[27] to a passage in Warren v Coombes[28] which mentioned the advantages enjoyed by a trial judge. But that was simply in the course of charting the development of the law in this State with respect to serious injury appeals.

122 It is true also that the High Court in Dwyer implicitly recognised the potential for serious injury applications to be affected by credibility issues.[29] But that was simply in the context of observing that in Dwyer there was no such issue.

123 Then there was the submission for the respondent that the High Court in Dwyer[30] had implicitly accepted the statement of Eames JA that 'the appeal court must recognise and give appropriate weight to the advantages of the trial judge, who has seen and heard the witnesses.'[31] In my view, the High Court did nothing of the sort. What it did do, in the paragraph cited by counsel, was simply address and reject a specific proposition advanced by Eames JA.

124 In all, I cannot discern in what the High Court said in Dwyer any proposition that findings of credibility, or affected by credibility, should stand in some special position by contrast with other findings made at first instance, and by contrast with the ultimate decision below.

125 In the event, I think that it is for this Court to resolve any credibility issue on an appeal governed by s 134AD. It will be assisted in the task if the judge who heard the application identifies the material which was relied upon by the parties in respect of a credibility issue. To the extent that the material consisted of an in-court demonstration, the judge should describe what he or she saw. If the judge made other observations which he or she considered pertinent with respect to the demeanour of a witness, the judge should describe the observations made.[32]

126 Beyond identification of the material relied upon by the parties in respect of a credibility issue, and description of observations made, the judges' reasons for decisions will explain what finding was made about credibility, and why. Such reasons may well assist this Court, although not forming any part of the material 'before' the judge, in resolving the credibility issue for itself. They will do so by disclosing the foundation for the credibility assessment. It is likely that, often enough, the reasons will advert to material which, broadly speaking, this Court is able to assess as well as the judge who heard the application. In the relatively rare case where something which happened in court influenced the judge's assessment, description of that incident, and its significance as the judge perceived it, will likewise provide assistance.

127 Finally, dealing with question of the correct approach, I should mention an issue which was not agitated. Counsel for the respondent was content to assume that the effect of s134AB(38)(j) of the Act is that this Court should make the assessment of serious injury as at the time when the application was heard below. I will act upon the assumption. It was not in any event suggested that the time of assessment could yield differing results in this case.

128 I have already analysed the medical and like material in some detail. It is unnecessary to recapitulate much of what I have already said. In my opinion - subject only to the impact of the surveillance films and the issue to do with the appellant's demeanour in court - the evidence of the appellant and of the medical practitioners and allied health professionals who had attended and examined her over the years made out a convincing case that she suffered serious injury constituted by depression and chronic pain syndrome, such injury being of the kind mentioned in paragraph (c) of the definition, and satisfying the requirement of severity required by that paragraph.[33] Accepting that the level of the appellant's symptoms varied from time to time over the years, they had required continuous treatment of a number of kinds. There was uncontradicted evidence that they had imposed significant limitations upon her daily activities and recreational pursuits, and that they had destroyed her employability. They had persisted for some 5 years by the time that her application was heard. Moreover, the requirement of 'permanence', as explained in Barwon Spinners Pty Ltd v Podolak,[34] was surely satisfied. Dr Rose was firm in his opinion that the appellant's condition as at March 2007 was unlikely to alter. He reiterated that opinion in July 2007. Dr Ryan was of like opinion. As at December 206, she considered that the appellant's mental disturbance was likely to persist in the foreseeable future. Mr Brearley saw no likelihood of any improvement in the foreseeable future when he reported on 19 February 2007.

129 But standing against a conclusion favourable to the appellant, the respondent submitted, were the surveillance films and the appellant's demeanour in court.

130 The films gave the lie, it was said, to the appellant's evidence that she always had a certain level of pain, that she had restricted capacity for lifting, that she did minimal reaching when hanging out her washing, that her husband mostly did the driving, that she was not able to work for any length of time above shoulder height, and that she felt socially isolated. They gave the lie, it was said, to the histories provided by the appellant to the doctors, which had stressed the extent of her pain and its impact upon her daily activities.

131 The appellant's demeanour in court, counsel for the respondent submitted, sharply contrasted with the freedom of movement which she exhibited in the films.

132 I do not accept the submission that the films had the devastating effect which respondent's counsel submitted was the case. I do accept, as I have earlier said, that they showed the appellant, for quite short periods, using her right arm in a normal way, moving her head freely, doing her shopping, and occasionally driving her car with her husband as a passenger. But the tasks performed by the appellant were not physically stressful, and the length of time for which she performed any action which could be considered significant was short. Put in context, and I need not repeat what I said in that connection, I think that the films advanced the respondent's case only to a very modest extent.

133 That leaves the appellant's in-court demeanour, as described by the judge. For reasons already explained, the appellant had good reason - viewed from her perspective - for perceiving that the occasion of her giving evidence was 'a big pain day'. I do not make of that conduct what the judge made of it. Neither, as I have already remarked, did Dr Rose make anything of like conduct on an other occasion. True it is that he did not see the films. But that leads only to speculation.

134 In all, I consider that the attack on the appellant's credibility was far from being made out. The attack having failed, the broad sweep of the material which I have described leads inevitably to a finding of serious injury in favour of the appellant.

135 I would allow the appeal, set aside the judgment below, and in lieu thereof order that the appellant have leave to bring a proceeding for damages in respect of the pain and suffering consequence and loss of earning capacity consequences of serious injury, that is to say, chronic pain syndrome, depression and anxiety.

136 Recognising that adequate reasons for decision are an integral part of the judicial process, County Court judges are already considerably burdened by the obligation to give reasons as on trial in applications of this kind. My reasons suggest, if this Court is to be equipped to perform the function which the High Court said in Dwyer is commanded by s134AD, that the burden is likely to increase. As the legislation now stands, nothing can be done about it.

137 I have had the advantage of reading a draft of the Reasons for Judgment of Ashley JA and agree that the appeal should be allowed for the reasons which he gives. The facts are fully set out in his Honour's judgment and I gratefully adopt his statement of the facts and his reasons and conclusions as an expression of my own.

138 In agreeing with the reasons and conclusions of Ashley JA, I wish to emphasise the importance of the task of the County Court judges in the giving of their reasons in any matter which comes to this court on appeal under s 134AB(16)(b) of the Accident Compensation Act 1958 ('the Act'). The High Court in Dwyer v Calco Timbers Pty Ltd[35] explained that the task of the Court of Appeal in considering an appeal under s 134AB of the Act was for it 'to decide for itself' whether the injury is a 'serious injury and to do so on the evidence and material before the primary judge

together with such other evidence as the Court of Appeal itself has received'.[36] That task, as Ashley JA explains, does not depend upon the Court of Appeal first finding error in the decision or reasons of the primary judge from which the appeal is brought. That fact, however, does not mean that the reasons for the decision of the primary judge are not of critical importance. The High Court in Dwyer itself referred to the assistance of 'what should be the detailed reasons of the County Court'[37] in the task of the Court of Appeal in its own consideration of the appeal. Such detailed reasons will serve as an important reference point from which the parties and the Court of Appeal may assess the evidence and against which the Court of Appeal can decide for itself the statutory issue upon which an appellant's rights depend.

139 This case depended greatly upon the proper conclusion to be drawn about the credibility of the appellant. The trial judge had an advantage in assessing her credibility. Such an advantage does not absolve this appeal court from giving effect to its own conclusion, as was made clear in the joint judgment in Fox v Percy.[38] An appellate court will not be assisted by poorly articulated statements about the credibility of a witness, but will greatly be assisted by full and carefully articulated reasons and explanations which bore upon the mind of the judicial officer who first heard the evidence upon which the appeal is brought. In that task it is critical that a reader can see the reasoning process leading to the conclusions which were expressed. Reasons need to explain why or in what way a conclusion is reached.[39] The giving of reasons requires a focus upon an expression and communication to those who receive them: what must occur is an exposition of the reasoning process for the reader so that the reader can understand how and why the writer's conclusion was reached.[40]

140 Such considerations assume a particular and important significance when the decision of the trial judge in this jurisdiction is based heavily upon findings about the credibility of witnesses. The Court of Appeal will be assisted by a full explanation by the trial judge setting out what reasons he or she had in finding against the credibility of a witness. Such judicial officers are experienced in the task of evaluating witnesses and their opinion about credibility will assist appellate judges when they embark upon an independent review for themselves about that same matter. The giving of full and adequate reasons by a primary trial judge are, of course, also important as the means by which the parties may see why it is that the case was decided as it was. Reasons provide an important safeguard to the parties and they also enable the parties to evaluate the utility and prospects of success of an appeal. Where a decision hinges upon the rejection of credibility of a witness it is incumbent upon the trial judge to do more than state that fact: he or she must also explain how or why that conclusion was reached.

141 In this matter we viewed the surveillance films at the request of the parties. In my view that evidence did not have the impact which it appeared to have on the trial judge. The reasons given by Ashley JA for this are the same as mine and I gratefully adopt what he said about this matter in his reasons. Against that evidence there was a significant amount of evidence from medical practitioners and occupational health workers who treated and examined the appellant which indicated that she suffered from depression and chronic pain syndrome for very many years. That evidence establishes to my mind that her disorder was permanent and severe. I am unable to see any reason to reject that evidence or the explanations given by the appellant in cross-examination when shown the surveillance films which Ashley JA has set out in his reasons for judgment.

142 Accordingly, I consider that she has established that she has sustained a serious injury within the meaning of the s 134AB(37) of the Act.

[1] Consisting of further examination in chief, cross-examination and re-examination.

[2] X-rays showed C6-7 degenerative changes with bilateral narrowing of the foramina.

[3] X-rays showed osteoarthritis, and the X-rays and ultrasound in combination showed probable low grade stress related injury.

[4] Ms Schneider, however, referred in her report dated 19 March 2007 to reports of Dr Miller dated 10 September 2003 and 12 May 2003. If there were such reports, they did not get into evidence.

[5] No doubt a reference to that provision as discussed in Mutual Cleaning and Maintenance Pty Ltd v Stamboulakis [2007] VSCA 46; (2007) 15 VR 649.

[6] (2005) VSCA 1, [21]-[22].

[7] See, for example, Hesse Roller Blind Company Pty Ltd v Hamitoski [2006] VSCA 121, [3] (Ashley JA), [19]-[21] (Redlich JA).

[8] [2008] HCA 13; (2008) 244 ALR 257.

[10] Hunter v Transport Accident Commission & Anor [2005] VSCA 1, [37] (Nettle JA); Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247, 279-280, 282 (McHugh JA); and Fletcher Constructions Australia Ltd v Lines MacFarlane & Marshall Pty Ltd [2001] VSCA 167; (2001) 4 VR 28, 35 [18] (Chernov JA). The fact that a 'credit issue' arose on the hearing below may tend in favour of remission for re-hearing. Whether remission is required is likely to depend upon the particular 'credit issue' which arose. These observations, of course, say nothing about the duty imposed on this Court by s134AD.

[11] I do not understand the judge's reference to 'a 16 month period'. It seems to be wrong.

[12] The first month of surveillance and the number of occasions of surveillance were there misstated.

[13] Had any of them been shown the films they must have reported; and any such report must have been produced.

[14] [2008] HCA 13; (2008) 244 ALR 257.

[15] In this instance, neither party sought to adduce further evidence, and the question in what circumstances the Court might receive it was thus not debated.

[16] I put to one side the possibility of receipt of other material.

[17] [2008] HCA 13; (2008) 244 ALR 257.

[18] [2003] HCA 22; (2003) 214 CLR 118; see also Suvaal v Cessnock City Council [2003] HCA 41; (2003) 77 ALJR 1449, Hoyts Pty Ltd v Burns [2003] HCA 61; (2003) 77 ALJR 1934 and Pledge v Roads and Traffic Authority [2004] HCA 13; (2004) 78 ALJR 572.

[19] [2003] HCA 22; (2003) 214 CLR 118, [23].

[22] Paraphrasing observations of McHugh J in Fox v Percy [2003] HCA 22; [2003] 214 CLR 118, 147, [92]-[93].

[23] As to which see [2003] HCA 22; (2003) 214 CLR 118, [21]-[23].

[24] Ibid [23]. An obligation imposed on this Court by operation of s134AD.

[26] Fox v Percy [2003] HCA 22; (2003) 214 CLR 118, 128, [28]-[29] (Gleeson CJ, Gummow and Kirby JJ).

[27] [2008] HCA 13; (2008) 244 ALR 257, [24].

[28] [1979] HCA 9; (1979) 142 CLR 531, 552.

[29] [2008] HCA 13; (2008) 244 ALR 257, [44].

[31] Dwyer v Calco Timbers Pty Ltd [2006] VSCA 187, [8].

[32] In this case, the accuracy of the judge's description of the appellant cradling one arm in the other whilst giving evidence was not in dispute. I leave to another day what should happen if the accuracy of a judge's description of something observed was challenged.

[33] As to which see Mobilio v Balliotis [1998] 3 VR 833, 834-835 (Winneke P), 846 (Brooking JA), 854 (Ormiston JA), 858 (Phillips JA) and 860-861 (Charles JA).

[34] [2005] VSCA 33; (2005) 14 VR 622, 632-633 [18]-[19] (Phillips JA, for the Court).

[35] [2008] HCA 13; (2008) 244 ALR 257.

[38] [2003] HCA 22; (2003) 214 CLR 118 [29].

[39] Ansett Transport v Wraith [1983] FCA 179; (1983) 48 ALR 500.

[40] Davidson v Fish [2008] VSC 32.