De Groot v The Nominal Defendant [2005] NSWCA 61 | Case summary

Court of Appeal (NSW)|2005-12-15|Before: Giles JA, Bryson JA, Gzell J

The application was based on s 148E of the District Court Act (to which the Trial Judge referred at Red 2/302) and the submissions in support of the application also referred to s 148B of the District Court Act and Pt 39A r 14 of the District Court Rules. The Notice of Motion did not identify the legal representatives against whom the order is sought, and no particular persons were named as prospective respondents in the application for leave to appeal. The submissions in support of the proposed cross-appeal went to great lengths, not extending to naming the persons who were to be affected by the proposed order, but maintaining an argument the principal burden of which was to the effect that the legal practitioners ought to pay costs thrown away in the resolution of medical issues by cross-examining experts on documents which the legal practitioners representing the appellant had not shown to them. There is no proposal to join the legal representatives supposedly affected as parties to the appeal, or to serve any process on them. 285 The Trial Judge considered the power to order a legal practitioner to pay costs in s.148E of the District Court Act 1973. The application for an order that the legal representatives of the appellant pay the costs of the respondent also fell within s 148B(1)(b). (Sections 148B and 148E were repealed by the Civil Procedure Act 2005 and provision to similar effect to s.148E is now made by s 98 of the later Act). Section 148E(1) relevantly provided: (1) The Court may, at any stage of an action, make one or more of the following orders in respect of a legal practitioner whose serious neglect, serious incompetence or serious misconduct delays, or contributes to delaying, the action: (a) disallow the whole or any part of the costs between the legal practitioner and his or her client; (b) direct the legal practitioner to repay to his or her client the whole or any part of the costs which the client has been ordered to pay to any other party; (c) direct the legal practitioner to indemnify any party other than his or her client against the whole or any part of the costs payable by the party indemnified. 286 The Trial Judge's reasons (Red 2/303) show that in her Honour's opinion she had no jurisdiction or power to make any order for costs against the appellant's legal representatives in circumstances where the tutor had been ordered and was liable to pay the respondent's costs by reason of the Calderbank letter, and where the tutor made no application for an order (such as s.148E(1)(b) would authorise) that those legal representatives repay to the appellant costs which the appellant had been ordered to repay to the respondent. With respect, these circumstances show no reason why there was no power to make an indemnity order under section 148E(1)(c). 287 The Trial Judge made further observations (Red 2/303 to 308) which appear to be directed to the way in which the discretion to make such an order should have been exercised if the power had existed. As her Honour had held that the power did not exist, these observations cannot be seen as an exercise of discretion. In these reasons the Trial Judge gave great weight and seems to have treated it as determinative that, as evidence showed, the tutor made no complaint against the legal representatives but said she had no problems with her solicitors and was quite happy with the way they had conducted the case. With respect, the attitude of the tutor could not correctly have been seen as determinative or even as important at all for the exercise of the discretion to make an indemnity order under s.148E(1)(c). 288 In the proposed cross-appeal it would be necessary to make an extremely detailed examination and appraisal of the manner in which the appellant's legal representatives managed the adduction of medical evidence and their communications with and furnishing of information to expert medical witnesses. There are large procedural shortcomings in the process by which the respondent raised this claim. Notwithstanding what I see as shortcomings in the Trial Judge's disposition, this is not a matter on which I regard it as appropriate to grant leave to appeal. 289 In the proposed cross-appeal there would be an overall appraisal of the manner in which the legal representatives of the plaintiff conducted the litigation with respect to the medical evidence (which was a very large part of the whole litigation). The manner in which litigation is conducted by solicitors is a subject for which solicitors are answerable to their clients, but only according to the overall relationship including constraints relating to the availability of funds, time and other resources. The relationship between the solicitor and the client is the primary focus for determining the solicitor's duty. The proposed appeal would relate to costs only, and leave to appeal on costs is not granted readily, and is usually obtained where some question of principle is involved. I do not see the appraisal in detail of a large array of factual matter and conduct over an extended period as a suitable subject for leave to appeal on costs. The Court should be on guard against incorporation of attacks on legal representatives of opponents into the forensic armoury. Even if the procedural difficulties to which I have referred had been attended to and the proposed respondent to the proposed appeal had been identified in some application to the Court of Appeal, the proposed cross-appeal would in my view have few prospects of success.

290 The end result of all the orders made by the Trial Judge is that the appellant has not recovered anything, and as the reasons of Gzell J show that the proposed cross-appeal on liability should not succeed, I am of the view that leave to cross-appeal as to orders for costs should not be granted, the claim in the Summons for leave to cross-appeal dated 11 December 2003 should be allowed so as to grant leave to cross-appeal on liability, but otherwise should be dismissed. The Court should direct that Notice of Cross-appeal be filed and served within 7 days. 291 The Court of Appeal should make these orders:

(1) Appeal dismissed with costs; (2) Upon the Summons for leave to cross-appeal, (a) grant leave to cross-appeal with respect to liability, (b) direct that Notice of Cross-Appeal be filed and served within 7 days, (c) save as aforesaid, dismiss the Summons. (3) Dismiss the Cross-appeal, with costs of the application for leave to cross-appeal and of the cross-appeal. 292 GZELL J: These reasons address The Nominal Defendant's summons for leave to cross appeal against the entry of a verdict against it by her Honour Judge Gibb. The application for leave to cross appeal against her Honour's refusal to order the legal representatives of Daniel Rory de Groot to pay costs has been addressed in the reasons for judgment of Bryson JA. 293 Leave is required because the verdict was less than $100,000 (District Court Act 1973, s 127(1)(c)). 294 Daniel was an infant travelling in the front seat of a motor vehicle. A prime mover with trailer passed in the opposite direction. Daniel was struck on the head by a wheel cleat that came off the trailer, penetrated the windscreen of the motor vehicle and struck him on the head. Her Honour awarded Daniel damages of $18,344.45. 295 The application for leave was based upon the high level of costs incurred in the matter. It proceeded before her Honour on 46 days and was recorded in over 3,000 pages of transcript. 296 In my view leave should be granted. The Nominal Defendant has a reasonably arguable case for challenging her Honour's finding of liability. Although the damages assessed by her Honour are modest, a much larger claim was made and high levels of costs were incurred by The Nominal Defendant in meeting that claim. 297 For the reasons that appear below, however, I am of the view that the appeal should be dismissed. 298 A wheel cleat is a cast iron object weighing about 450 grams. It is part of a system securing an inner hub of the outer of the dual wheels of a heavy truck or trailer to the outer rim that carries a tyre. A wheel cleat is roughly triangular in shape and has a hole through it. It is passed over a wheel stud tapped into the hub or "spider". A nut is threaded onto the stud. When the nut is tightened the wheel cleat exerts pressure on the rim thus holding it tight up against the spider. The prime mover and trailer were not identified. 299 Her Honour found that the cleat became detached from a wheel of the trailer. That finding was not challenged by The Nominal Defendant. 300 Her Honour analysed the possible causes for the detachment of the cleat. One possibility was a manufacturing defect in a stud. 301 John Jamieson was a master of engineering science, traffic and transportation from the University of New South Wales. Her Honour noted that Mr Jamieson had conceded that a stud could fracture as a result of a manufacturing error. 302 Mr Jamieson also gave evidence that wheel cleats were secured by a single nut and were thus vulnerable to work loose or come off if the securing nut had not been done up properly. Nuts were vulnerable to work loose if they were insufficiently tightened when installed. Mr Jamieson explained that nuts worked loose, typically, because they were either damaged, stripped through over-tightening or they were insufficiently tightened and were unable to withstand dynamic loads from a rotating wheel on a rough surface. He could not say whether a nut that may have been stripped or a nut that may have been insufficiently tightened was the more likely occurrence. 303 Grant Johnston held a bachelor of civil engineering degree in transport engineering and engineering construction from the University of New South Wales. Her Honour noted that Mr Johnston had, on one occasion, retrieved a cleat and a stud. 304 Mr Johnston also said that cleat detachment could occur in one of two ways. First, by not properly tightening the wheel nut so that it worked loose from the retaining stud. Secondly, the stud could fail in a shear type failure, most likely from fatigue loading, as cleats were generally protected in their inward position from direct impact. 305 Mr Johnston had given other evidence on imputed impact speed and the probability of head injury from such an impact. Her Honour placed little weight on the report and opinions of Mr Johnston. She found him to be an unreliable and intemperate witness of very limited expertise. She completely disregarded any opinion he expressed on matters medical on the basis that he lacked relevant skill and qualification. 306 Dr Peter Sweatman held a doctor of philosophy in mechanical engineering - vehicle dynamics and a bachelor of engineering honours degree from Melbourne University. A report of his was in evidence. 307 Her Honour noted that Dr Sweatman had said that many years of experience in the manufacture and use of the spoke-cleat system had resulted in high reliability in an engineering sense. She noted the submission that stud failure was far less likely a cause than a loose nut. Her Honour said that, nonetheless, stud failure was a real possibility on the evidence before her. 308 Dr Sweatman's report also stated that an intact wheel cleat might come loose because of gross failure correctly to attach the dual wheels. He said the action of all cleats was interdependent and it would be virtually impossible to leave one cleat loose without all or most cleats also being loose or gross misalignment occurring. Another possibility was damage to the cleat. He said this would be obvious during wheel mounting and would make the entire securing process difficult. He said cleats were extremely robust and immune to damage once they were correctly in place. The third possibility was the failure of the attachment stud or thread. He said this would require significant over-tightening during fitment together with over-stress caused in service. Finally he said the cleat attachment nut might work loose. He said this possibility was unlikely because once the attachment nuts were tightened, the cleat acted as a tensioning and locking method. 309 Her Honour then discussed the issue of maintenance. She noted Mr Jamieson's evidence that nuts were vulnerable to work loose if they were insufficiently tightened when installed. She accepted Dr Sweatman's evidence that wheels and tyres should be checked at least weekly including a visual check and checks of the presence and tightness of wheel nuts. Dr Sweatman had said that experience showed that it was possible for wheel nuts to come loose but this normally caused increased vibration that might be noticed by a driver. With respect to this latter opinion, her Honour preferred other evidence. 310 Philip John Scott, an automotive engineer, had been employed in the Australian army engineer corps over a three year period, initially as an operator of heavy vehicles, but subsequently with the responsibility for the maintenance of heavy vehicles including ensuring that drivers maintained their own vehicles properly. Many of the vehicles were fitted with spider wheel systems. Mr Scott then worked for a year at Mount Newman where he was involved in the maintenance of exceptionally heavy road transport vehicles fitted with spider wheel systems working off-road. Mr Scott was then engaged in dealerships at Wagga Wagga and on the central coast of New South Wales. He performed service calls on heavy vehicles fitted with spider wheel systems. Following a nine year period during which he taught at the Department of TAFE, training mechanics in proper maintenance practice in relation to heavy vehicles, he entered a consultancy business involving inspection of heavy vehicles and reviewing failures of vehicle system components. 311 Her Honour accepted the evidence of Mr Scott that, in practice, a driver might not be aware that a cleat was missing. Her Honour also accepted Mr Scott's observation that wheel nuts and cleats might become detached from vehicles despite the best care and standard having been applied. 312 Mr Scott had also said that on many occasions during his service in the army he noticed that cleats were missing. Whilst not a daily occurrence, it was sufficiently frequent to make it necessary to carry a supply of replacement cleats and nuts. In the majority of cases where a cleat was missing, the retaining wheel nut was also missing. On comparatively rare occasions, he estimated one in six, a stud was either fractured or missing. Mr Scott said that whenever a nut was missing, the cleat was also missing. 313 At Mount Newman, Mr Scott said the incidence of vehicles returned to the workshop missing a cleat was somewhat higher than his experience in the army, but the same pattern emerged: in five out of six cases, the stud would be there but the nut and cleat would not. 314 During his subsequent engagement in service calls on heavy vehicles, Mr Scott observed missing cleats and nuts with the occasional missing stud. As a consultant, he said he continued to find a similar incidence of missing cleats, nuts and studs in roughly the same proportions. 315 Her Honour then addressed a truck driver's maintenance obligations. She noted Mr Scott's concession that a driver might not observe a latent defect or an over-tightened nut. She accepted his evidence of the steps a driver should take. 316 Mr Scott had said that proper maintenance of spider wheel systems required wheel studs to be inspected for any visible impact damage to threads and for any bending of studs. The thread of the stud and nut had to be clean. Wheel nuts had to be tensioned to manufacturers' specifications. The design of the wheel nut had to suit the cleat being used on the wheel. When mounting a wheel onto a hub, care had to be taken to ensure that the wheel rim did not impact on the stud. That might result in damage to the thread of the stud and cross threading of the retaining nut. Wheel nuts had to be progressively tightened in the correct sequential order, alternating to opposite sides of the wheel. After each progressive step, the wheel had to be rotated to check for any run-out of the wheel. Wheel nuts had to be re-tensioned after initial use. This usually occurred between approximately 50 kilometres and approximately 350 kilometres. 317 Her Honour accepted Mr Scott's statement that in his experience, vehicles maintained carefully had a significantly lower incidence of missing cleats and nuts and also of stud failure. 318 Mr Scott had also said that on the road, drivers carried a wheel brace and a pipe to fit on the wheel brace to increase pressure when loosening nuts to change a tyre. Nut tightening by a wheel brace was a matter of subjective perception by the driver. Air-driven tension wrenches on which an appropriate torque might be set, were confined to the workshop. Mr Scott said it was possible for a driver to over-tighten or under-tighten a nut on the road without being aware of it. Over-tightening might cause a nut to break. Over time, vibration from a heavy load on a rough road might affect a nut. Mr Scott had the experience of checking the nuts on the wheels of a trailer yet finding a nut and cleat missing when checking again after about 120 to 150 kilometres. 319 If a driver tested a nut and found that it was tight, Mr Scott agreed the driver had no idea if it was over-tightened. It was also possible that a nut might have a manufacturing defect not discoverable by visual inspection. A wheel nut that appeared to be sufficiently tightened, might work loose as the wheels flexed under load and vibration worked the nut loose. It was possible that this might occur if a truck travelled along a section of rough road. 320 Her Honour noted that the relevant section of the roadway where the incident occurred was very rough and the possibilities open by way of explanation of the cleat detachment included the roughness of the road surface. 321 Her Honour then set out the various causes of cleat detachment that might arise: "Even with the exercise of due care, a wheel nut and cleat may come adrift. There are various explanations open: manufacturing error/defect; spontaneous fracture; the condition of the road surface; speed (of which there is no acceptable evidence); failure to correctly tension the nut/stud; over-tightening; a cross threaded nut; metal fatigue due to the age of the stud or nut; a combination of any of these; or an act or omission by someone other than the defendant." 322 Her Honour then asked herself the question whether it was open to her to draw the inference that the detachment of the cleat occurred by reason of some act or omission on the part, either of the driver of the prime mover, or the owner of the trailer. She referred to Nominal Defendant v Haslbauer (1967) 117 CLR 448. That was a res ipsa loquitur case. The plaintiff was a passenger in a stationary vehicle hit from behind by an unregistered vehicle with defective brakes. She received an award of damages from a jury. On appeal she failed in her submission that in the absence of evidence of knowledge by the driver of the defective vehicle of the condition of the brakes, negligence could be inferred from the fact of the collision. Her Honour referred to passages from the judgment of Sir Garfield Barwick including the following, at 452, on the inference that might be drawn: "To make a prima facie case in a claim based on the defendant's negligence, a plaintiff may be content to rely upon such inferences as can be drawn from the fact of the occurrence which he claims to be due to the defendant's negligence. An inference of such negligence may be drawn where, in the ordinary course of human affairs, such an occurrence is unlikely without want of care on the part of a person in the situation of the defendant. In such a case, the occurrence itself may be said to bespeak the lack of care. Or if his pleadings are wide enough, a plaintiff may rely both upon such an inference and upon evidence, beyond that of the occurrence itself, of specific acts or omissions of the defendant indicating a want of care." 323 Her Honour must have been thinking of drawing an inference from acts or omissions of the driver or trailer owner beyond the fact of the occurrence, because she had already noted that the plaintiff did not rely upon res ipsa loquitur and the principle was not open where the cause of an occurrence was determined. Her Honour had quoted that proposition from Schellenberg v Tunnel Holdings Pty Ltd (1999-2000) 200 CLR 121 at [42] to [45]. 324 Her Honour went on to state that she drew the inference that the cleat detached because the nut was not correctly secured, the driver of the prime mover failed properly to check the tensioning of the nut and a proper check would have revealed the deficiency: "Notwithstanding the range of possible explanations for the detachment of the wheel cleat ( sic ) (and therefore the cleat), I draw the inference that this cleat came adrift from the wheel of the approaching semi-trailer because the nut was not correctly secured and tensioned; and that, ultimately, the responsibility for checking the security of the wheel nuts rested with the driver of the vehicle. I infer that the defendant - the driver - failed properly to check and ensure that the nut was properly tensioned; and that had a proper check been made, the deficiency could and would have been identified and rectified." 325 Her Honour did not explain why she reached this conclusion as distinct from other conclusions that were open to her. Her train of thought has not been revealed. 326 It was submitted that her Honour misdirected herself with respect to the evidentiary test in Luxton v Vines (1952) 85 CLR 352 at 358 that in civil proceedings circumstances raising a more probable inference in favour of what is alleged is sufficient. 327 Her Honour was aware of this principle. She set out the passage in her reasons for judgment. And she had regard to the discussion on reliance upon inferential reasoning to prove negligence in a case to which res ipsa loquitur did not apply in Schellenberg. 328 In my view it is a fair reading of her Honour's judgment that what she meant by drawing the inference that the cleat came adrift in the way she specified was that she concluded, on the balance of probabilities, that the cleat coming adrift in the way she specified was the more likely explanation. Mindful of the principles in the authorities which she cited, her Honour must be taken to have concluded that the case was not one of competing causes of equal likelihood. 329 Although her Honour did not reveal her train of thought, and drawing an inference is often not readily susceptible to precise explanation, I consider that her Honour's conclusion was open and, on the evidence, was correct. 330 From the evidence of Dr Sweatman and Mr Scott, there was a high probability that the cleat detached because of loosening of the nut rather than because of stud failure, including failure due to over-tightening the nut. As a broad measure of that probability, Mr Scott's experience was of stud failure as a one in six occurrence. Dr Sweatman's evidence of the general reliability of the system underlined the high probability that the incident occurred because of the loosening of a nut rather than gross failure correctly to attach a wheel. 331 What then had to be taken into account was the probability of negligent failure initially to tighten the nut or, perhaps more significantly, negligent failure to check the tightness of the nut, as distinct from the nut working loose despite initial proper tightening and proper checking, as Mr Scott recognised could happen. This probability was to be assessed in light of Mr Scott's experience that carefully maintained vehicles had a significantly lower incidence of missing cleats and nuts as well as of stud failure. In this respect, it was not only a case of re-tensioning 50 to 350 kilometres after initial tensioning, or after an earlier inspection, as stated by Mr Scott, but also of checking at least weekly as stated by Dr Sweatman and accepted by the Trial Judge. 332 These probabilities must be combined in arriving at the probability that negligence caused Daniel's injury (see Hodgson, The Scales of Justice: Probability and Proof in Legal Fact-finding (1995) 69 ALJ 731 at 746-750). 333 It would be unrealistic to ascribe numbers to the probabilities and, mathematically, compute a probabilistic conclusion. Judicial fact-finding in circumstances such as the present is not a mathematical operation. 334 In my opinion, the evidence established, on the balance of probabilities, that negligence did cause Daniel's injury. If it be a different thing, her Honour was entitled to infer that the cleat became detached because of a loose nut, the tightness of which was not properly checked and rectified. 335 As a check upon the process of inference, an 80% probability of a loose nut rather than some other problem with the attachment of the cleat and a 65% probability of failure in checking would result in a 52% probability of negligence. Numbers of that order appear to me to be warranted on the evidence. 336 In my view The Nominal Defendant has failed to demonstrate that her Honour erred in concluding that the driver of the truck was negligent. 337 I agree with the orders proposed by Bryson JA. I agree with his Honour's reasons save insofar as Giles JA has departed from them. I agree with the reasons of Giles JA and join him in respectfully diverging from the reasons of Bryson JA in the limited circumstances discussed by his Honour.

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Motor Accidents (Amendment) Act 1989(NSW)

Motor Accidents (Amendment) Act 1995(NSW)

District Court Act 1973(NSW)ss 127(1)(c), 148B, 148E

Motor Accidents Act 1988(NSW)ss 39, 45, 70A, 79

CITATION: De Groot v The Nominal Defendant [2005] NSWCA 61

Abalos v Australian Postal Commission (1990) 171 CLR 167 Carter v Boan [2001] NSWCA 160 Devries v Australian National Railways Commission (1993) 177 CLR 472 Expectation Pty Limited v PRD Realty Pty Limited (2004) 140 FLR 17; 209 ALR 568 Fox v Percy (2003) 214 CLR 118 Jones v Dunkel (1959) 101 CLR 298 Jones v Hyde (1989) 63 ALJR 349 Knight v F P Special Assets Ltd (1992) 174 CLR 178 Luxton v Vines (1952) 85 CLR 352 CASES CITED: Mifsud v Chemplex Australia Limited [1999] VSCA 175 Moylan v Nutrasweet (2000) NSWCA 337 Nominal Defendant v Haslbauer (1967) 117 CLR 448 O'Brien v O'Brien (1995) 35 NSWLR 664 Purkess v Crittenden (1965) 114 CLR 164 Schellenberg v Tunnel Holdings Pty Ltd (1999-2000) 200 CLR 121 State Rail Authority of New South Wales v Hammond (1988) 15 NSWLR 395 Warren v Coombes (1979) 142 CLR 531 Wiki v Atlantis Relocations (NSW) Pty Limited (2004) 60 NSWLR 127

19 Senior counsel contended that it was no part of the appellant's medical case that his injury resulted in any motor abnormalities or neurological deficits; and hence that a normal observation on a routine examination at the physical and neurological level by a general practitioner, occupational therapist or physiotherapist does not gainsay the presence of the type of brain damage that the appellant was contending for. It was contended that the Trial Judge did not have a full or firm grasp of the nature of the appellant's contention; and that this was illustrated by her treatment and acceptance of the contention that there had been a good recovery, of which Senior counsel observed that on the appellant's case good recovery of a motor kind was irrelevant. 20 The hearing before Judge Gibb was very lengthy, according to transcript headings taking 45 days, seven days in December 2001, five days in March 2002, 9 days late in April and in May and a long more or less continuous session from 3 June 2002 until 11 July; there were other hearing days. There were several thousand transcript pages of evidence and submissions and 1860 pages of exhibits. The trial was conducted in a highly combative way and issues were explored to a degree which retrospectively is not always easy to understand. The combative and even confrontational nature of the hearing is sometimes observable in exchanges between the Bar and the Bench. The narrations I have given in an attempt to outline the issues could well be regarded by one or other of the parties as open to contention in some ways. 21 The nature of the issues naturally led to close examination of whatever indications were available of the condition and abilities of the appellant before he was injured. As well as the evidence of Ms Van Oosten, which the Trial Judge found to be very unreliable, there were other sources, but although they had inherent importance they were very difficult to assess, largely because the appellant was only four years and eight months old when injured and there were very few sources of objective information or professionally trained observation of his abilities so early in life. 22 At all times on appeal, as at first instance, it is necessary to keep it clearly in view that the onus of proof, on the balance of probabilities, of the facts upon which the damages claim rested lay upon the appellant. 23 It is also necessary to keep in view the duties and the responsibilities of the appellate Court in an appeal against findings of fact at first instance. The responsibilities of this Court when deciding an appeal by way of rehearing under Supreme Court Act 1970 (NSW) s 75A have been considered a number of times in the High Court of Australia, most recently and significantly in Fox v Percy (2003) 214 CLR 118. The principal judgment (and the High Court was unanimous as to the outcome) is that of Gleeson CJ, Gummow and Kirby JJ, who considered the powers and functions of the Court of Appeal in a passage at 124 [20] to 129 [31], and pointed [25] to the obligation of the appellate Court to conduct a real review of the trial and of the judge's reasons and to its duty to decide on the proper inference to be drawn from facts which are undisputed or have been established by other findings, and referred to Warren v Coombes (1979) 142 CLR 531 at 551 and other authorities. 24 In Fox v Percy their Honours referred to decisions later than Warren v Coombes which contain statements or restatements of the need for appellate respect for the advantages of trial judges, especially where decision might be affected by the judge's impression about the credibility of witnesses. Their Honours said (at 127 [26]) of Jones v Hyde (1989) 63 ALJR 349 at 351-2, Abalos v Australian Postal Commission (1990) 171 CLR 167 at 179 and Devries v Australian National Railways Commission (1993) 177 CLR 472 at 479, 482-483:- The decisions were simply a reminder of the limits under which appellate Judges typically operate when compared with Trial Judges. 25 Their Honours said, while not derogating from the obligation to perform the appellate function, that the three decisions remained the instruction of the High Court to appellate decision-making. The instruction included, in Devries v Australian National Railways Commission, the statement by Brennan, Gaudron and McHugh JJ at 479:- More than once in recent years, this Court has pointed out that a finding of fact by a trial judge, based on the credibility of a witness, is not to be set aside because an appellate court thinks that the probabilities of the case are against - even strongly against - that finding of fact [3. See Brunskill (1985) 59 ALJR 842; 62 ALR 53; Jones v Hyde (1989) 63 ALJR 349; 85 ALR 23; Abalos v Australian Postal Commission (1990) 171 CLR 167]. If the trial judge's finding depends to any substantial degree on the credibility of the witness, the finding must stand unless it can be shown that the trial judge 'has failed to use or has palpably misused his [or her] advantage' [4. SS Hontestroom v SS Sagaporack [1927] AC 37, at 47] or has acted on evidence which was 'inconsistent with facts incontrovertibly established by the evidence' or which was 'glaringly improbable' [5. Brunskill (1985) 59 ALJR, at 844; 62 ALR, at 57]'. 26 In Fox v Percy their Honours also said (128 [28]): However, the mere fact that a trial judge necessarily reached a conclusion favouring the witnesses of one party over those of another does not, and cannot, prevent the performance by a court of appeal of the functions imposed on it by statute. 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. [29] 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. (46 eg, Voulis v Kozary (1975) 180 CLR 177; SRA (1999) 73 ALJR 306; 160 ALR 588; cf Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd (1992) 27 NSWLR 326 at 349-351.) 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. 27 Their Honours went on (at 129 [30] and [31]) to make observations, which in the present context are cautionary, about the force of the assessment of the appearance of witnesses and the danger of too readily drawing conclusions about truthfulness and reliability solely or mainly from the appearance of witnesses. Their Honours said: [30] It is true, as McHugh J has pointed out, that for a very long time judges in appellate courts have given as a reason for appellate deference to the decision of a trial judge, the assessment of the appearance of witnesses as they give their testimony that is possible at trial and normally impossible in an appellate court. However, it is equally true that, for almost as long, other judges have cautioned against the dangers of too readily drawing conclusions about truthfulness and reliability solely or mainly from the appearance of witnesses (eg Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd (1992) 27 NSWLR 326 at 348, per Samuels JA.). Thus, in 1924 Atkin LJ observed in Société d'Avances Commerciales (Société Anonyme Egyptienne) v Merchants' Marine Insurance Co (The "Palitana"):- "... I think that an ounce of intrinsic merit or demerit in the evidence, that is to say, the value of the comparison of evidence with known facts, is worth pounds of demeanour." [31] Further, in recent years, judges have become more aware of scientific research that has cast doubt on the ability of judges (or anyone else) to tell truth from falsehood accurately on the basis of such appearances…Considerations such as these have encouraged judges, both at trial and on appeal, to limit their reliance on the appearances of witnesses The issues in the present appeal bring her Honour's observations of witnesses under attention. 28 There are cases where demeanour and a decision to place confidence in the account of one of two or more witnesses who give conflicting evidence is an adequate and satisfactory means of reaching resolution of disputed issues of fact and of explaining the basis of the decision to the parties; but that is not commonly the case where there is a conflict on a matter of opinion between properly qualified experts. Recent case law was reviewed and its effect explained in Wiki v Atlantis Relocations (NSW) Pty Limited (2004) 60 NSWLR 127 at 135 - 139 by Ipp JA. It is usually, indeed almost always necessary to give reasons which go beyond expressing reliance on demeanour when resolving differing views of expert witnesses, by furnishing an analysis of the basis of the findings. In Expectation Pty Limited v PRD Realty Pty Limited (2004) 140 FLR 17 209 ALR 568 at 572 [67], the Full Court of the Federal Court of Australia (Carr, Emmett and Gyles JJ) referred to the difficulties of accepting the ability of judges or anyone else to tell truth from falsehood accurately on the basis of the appearance of witnesses and said:-. Such considerations should encourage trial judges and appellate judges to limit their reliance on the appearance of witnesses and to reach conclusions, as far as possible, on the basis of contemporary materials, objectively established facts and the apparent logic of events: 29 The differing expert views which were before Judge Gibb for adjudication were not to be resolved by an attempt to tell truth from falsehood, and on a reasonable basis required evaluation of the opinions expressed and the bases for them, including the factual bases. 30 The object which struck the appellant was a wheel cleat, a metal object forming part of the structure of the wheel of a semi-trailer which was travelling in the opposite direction to the vehicle in which the appellant was a passenger; the cleat became separated from the wheel of the semi-trailer, was propelled through the windscreen of the vehicle in which the appellant was travelling and struck him on the head. That a metal object of this kind, said to weigh 350 to 400 grams (and the object itself was not available to go into evidence) should strike a child under five years old and cause a depressed parietal skull fracture is a significant event which must come under consideration as a cause of later disability. Senior counsel for the appellant pointed to various elements in the facts which he said supported on a commonsense view of causation, finding that disabilities which the appellant now has were caused by his head injury. To my mind the ordinary lay interpretation that there could well be a causal connection between the injury and the present disabilities is an available and important line of reasoning, but in a case so full of medical opinion also bearing on causation, it is necessary to look much further. 31 As well as the evidence of Professor Broe a consultant neurologist and of Dr Johnson a paediatrician, the appellant relied on the oral evidence of Dr Buckley a consultant physician in rehabilitative medicine, of Mr Mark Ravagnani a Consulting Psychologist, of Ms Suzanne Ravagnani an Occupational Therapist (and these witnesses were cross-examined) and of seventeen other doctors and medical professional persons who gave evidence in written reports and were not cross-examined; these included a Consultant Neurologist, a Clinical Neuro-psychologist, a Consultant Neuro-physician, Professor Buchanan who dealt with epilepsy, Neuro-Psychologists, Paediatricians, General Practitioners and others. Hospital notes were tendered from Grafton Base Hospital, the Royal Children's Hospital Brisbane and the New Children's Hospital Sydney and there were some treating rehabilitation notes in evidence. The appellant also tendered all school reports which were available up to the time of the trial. The respondent put in evidence the reports and oral evidence of Dr Jones a paediatric neurosurgeon and Professor Werry a psychiatrist; and they were cross-examined. The respondent had available to it evidence from five other medically qualified persons who examined the appellant; but did not serve their reports or call their evidence. These included a Paediatric Neuropsychologist, a Paediatric Psychologist and two Paediatric Psychiatrists. 32 In a passage of the judgment headed "Introduction" (Red 1/29-30) the Trial Judge referred to a number of matters which were not in evidence and said -- "… The case is characterised as much by what it lacks as what it covered." These included that the Trial Judge did not see nor hear evidence from the appellant who was then 12 years of age, nor from his father; that she had not seen a report from a pre-accident treating doctor; that she had not seen a report from any doctor who treated the appellant after the accident which supported the claim that he sustained "... a relevant brain injury as distinct from a head injury"; that she had not seen a single treating doctor or received a comprehensive report from any treating doctor; that she had not seen any preschool reports predating the accident, or any school reports later than mid-year 2001.

Ground 22 - The learned judge should have ordered the Respondent to pay the whole of the Appellant's costs of the proceedings. 245 The orders which accompanied the reasons published on 30 September 2002 included orders as to costs (Red 1/22) which (para 7) confirmed costs orders made during the proceedings and ordered that the respondent pay the appellant's costs in accordance with the District Court Rules. The orders went on to list costs orders made during the course of proceedings which were confirmed. One of these is dealt with in ground 21 with which I deal separately. 246 The respondent then asked for an order for costs on the basis of a Calderbank offer, made on Wednesday 5 December 2001 at 4.27pm, of $150,000.00 plus costs as agreed or assessed, less a deduction of $27,786.53 in respect of payments made by the respondent for or on behalf of the appellant. The offer was open till 4.30pm on Monday 10 December 2001 , but was not accepted. The Trial Judge heard the application for costs on 13 November 2002 and made further orders dealing with costs on 29 November 2002, for reasons then published (Red 1/2/274-308). These varied the orders as to costs made on 30 September 2002. The principal order dealing with costs was Order 4 (Red 1/2/274J-N):- …I order that: · the defendant pay the plaintiff's costs in accordance with the District Court Rules up to the making of the Calderbank offer (4.27pm on Wednesday 5 December 2001); · there be no order as to costs for the period that the Calderbank offer was open (from 4.27pm on Wednesday, 5 December 2001) until the date at which the plaintiff's tutor and legal representatives decided not to accept the offer, identified as being before Court resumed on Thursday 6 December 2001 (albeit that such refusal was not communicated to the defendant); and · as and from the start of the hearing on Thursday, 6 December 2001, the plaintiff's tutor pay the costs of the defendant in the proceedings generally. 247 The Trial Judge went on (order 5) to vacate some costs orders which had been made in the course of the hearing in favour of the appellant but (orders 4 and 6) to confirm costs orders which had been made in the course of the hearing in favour of the respondent. The orders went on (order 7) to deal specifically with several issues relating to costs. The orders dealt with certification for Senior counsel, and an application that the respondent's costs be paid in whole or in part by the appellant's legal representatives. These have not led to any ground of appeal, but there is an application for leave to cross-appeal relating to the claim against legal representatives, with which I deal later. 248 The general orders for costs in order 4 do not refer to the assessment of costs on any special basis, such as the solicitor and client basis or the indemnity basis. The orders impose liability on the appellant's tutor, not on the appellant himself. Orders 8 & 9 are (Red 1/2/275D-F):- 8. I do not make any order that any costs be off-set against any judgment sum. I note, however that the judgment sum is less than that which had been paid to the plaintiff by the defendant before the hearing, and note that the defendant has the credit of any such payments. 9. I direct that the defendant may off-set against any costs payable by the defendant to the plaintiff's tutor the value of any costs payable to the defendant by the plaintiff's tutor. 249 The respondent's application was made by Notice of Motion filed on 28 October 2002 which claimed a variation of the costs order of 30 September 2002 in the following respects (Black 16/3475):- (a) That the order that the defendant pay the plaintiff's costs be vacated. (b) That the defendant's costs from 5 December 2001 be awarded against the tutor in the proceedings, Arlena Van Oosten. (c) That the defendant's costs from 5 December 2001 be paid in whole, or in part, by the plaintiff's legal representatives. (d) That the defendant pay the plaintiff's costs to 5 December 2001. 250 The legal representatives referred to were not identified or made respondents to the Notice of Motion and no grounds for making an order against them were stated. 251 The applications were heard together. Contentions were made, and referred to in the Trial Judge's reasons of 29 November 2002 as follows (Red 1/2/279C):- The defendant's Senior counsel submitted: …..it appears to us that there is no evidence from the tutor and that there is definitely a point where she may come into conflict with the legal advisers and require independent legal advice, that would be our submission. 252 It also appears that the Respondent's counsel referred the Trial Judge to Mifsud v Chemplex Australia Limited [1999] VSCA 175 at paras 40-51. There is no reference to an application by the respondent that the Court should disqualify the appellant's legal representatives from appearing for him on the ground of conflict of interest. As there was no such application I do not find it possible to see why the respondent's counsel raised the question of conflict of interest. The Trial Judge accepted and acted on evidence to the effect that the tutor had given instructions that she did not seek indemnity on her own part from the solicitors who acted for the appellant. Appropriately, the Trial Judge treated this as disposing of the question of conflict of interest. Any question or appearance of conflict was raised by the course chosen by the respondent of making an application adverse to interests of the tutor and an application adverse to the interests of the legal representatives in the same Notice of Motion and presenting the applications to the Court at the same time. This was not an appropriate course. Except, it may be, in some very simple and obvious cases, procedural justice requires that an application for an order that the costs of a party be paid by the legal representatives of another party should be made in an altogether clear way, a suitable way being by Notice of Motion in which the legal representatives against whom orders are sought are named as respondents to the Notice of Motion; such an application should not be joined with an application for costs or other remedy against a party. If an objection to representation on the ground of conflict of interest is made, it should be made in a similarly clear and distinct manner. The prospect that applications like these may give rise to some need to reconsider representation is quite clear. Extemporised procedures are likely to give rise to disruption of representation. I am unable to see why the respondent's counsel raised the matter before the Trial Judge, or what interest the respondent had in the potential conflict of interest, or why the respondent's Senior counsel referred to that subject. 253 Courts should guard themselves against stratagems which include collateral attacks on the legal representatives of the opposing party, whether based on claims for costs, on professional discipline, on supposed conflicts of interest or otherwise. Overbearing the opponent's legal representatives by threats against their personal positions is outside the range of legitimate strategies for conducting litigation. Attacks on bases like that should be made with whole-hearted sincerity and on solid grounds or the subjects should not be raised at all. If anything is to be done, it should be done by making an application to the Court, not by uttering threats. 254 The Trial Judge published reasons relating to costs orders, which dealt with the subject at remarkable length. 255 At the time of the hearing offers of compromise were dealt with by Pt 39A r 25 of the District Court Rules and Practice Note No. 42. The respondent did not at any time make an offer of compromise in accordance with those provisions. The provisions of Pt 39A r 25 tend to work against late delivery of offers of compromise, and against the delivery of offers of compromise at times when they cannot be given mature and careful consideration. A reasonable opportunity for consideration is particularly important where, as here, it is necessary for a tutor to come to a decision about the interests of another person, and to obtain the approval of the Court for any settlement. 256 The hearing of the proceedings began before her Honour Judge Gibb at Sydney on Monday 3 December 2001. The evidence of several witnesses was taken and the proceedings were adjourned so that another judge could deal with a claim for legal professional privilege relating to some subpoenaed documents. After that had been dealt with the hearing before Judge Gibb resumed on Thursday 6 December 2001 and continued on Friday 7 December, Monday 10 December and thereafter for many days. The Trial Judge found that by a letter delivered at about 4.27pm on Wednesday 5 December 2001 the respondent's solicitors conveyed an offer to settle the matter for $150,000.00 plus costs as agreed or assessed; and payments which had been made by the respondent as at that date which totalled $27,786.53 were to be deducted. The offer was expressed to be open until 4.30pm on Monday 10 December 2001. This was a Calderbank offer, that is, it expressed an intention to ask the Court to treat the offer as relevant to the question of costs. The offer was considered by the appellant's counsel and solicitor and tutor, and before the hearing resumed on Friday 7 December the tutor gave instructions, accepting advice, not to accept the offer. The offer was not accepted; it was not responded to and the time in which it was available ran out on Monday 10 December. 257 The Trial Judge's consideration of case law relating to Calderbank offers, and evidence in the proceedings was extensive; her decision appears to turn on this finding (Red 1/2/302C):- Having regard to that which was known to the plaintiff's legal representative and the plaintiff's tutor - or reasonably ought to have been known - at the relevant time, it was plainly unreasonable not to accept the defendant's offer.

De Groot v The Nominal Defendant

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