The Nominal Defendant v Kostic

CATCHWORDS: APPEAL - grounds - failure to give reasons - whether trial judge failed to give reasons or to give adequate reasons - failure to consider evidence - whether trial judge failed to give consideration to relevant evidence - whether new trial should be ordered. D

LEGISLATION CITED: Motor Accidents Compensation Act 1999 (NSW), s 128 Suitors Fund Act 1951 (NSW)

Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430 Darke v El Debal [2006] NSWCA 86 CASES CITED: Goodrich Aerospace Pty Limited v Arsic [2006] NSWCA 187 Mifsud v Campbell (1991) 21 NSWLR 725 Waterways Authority v Fitzgibbon (2005) 79 ALJR 1816 Whalan v Kogarah Municipal Council [2007] NSWCA 5

PARTIES: The Nominal Defendant (Appellant) Sladjana Kostic (Respondent)

COUNSEL: S G Campbell SC/S McCarthy (Appellant) I D M Roberts SC/R J M Foord (Respondent)

SOLICITORS: McLachlan Chilton (Appellant) Martin Bell & Co (Respondent)

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40341/06 DC 642/05

HODGSON JA IPP JA CAMPBELL JA

Thursday 15 February 2007 THE NOMINAL DEFENDANT v SLADJANA KOSTIC Judgment 1 HODGSON JA: I agree with Ipp JA. 2 IPP JA: On 9 February 2007, this Court (constituted by Mason P, Tobias JA and myself) delivered judgment in Whalan v Kogarah Municipal Council [2007] NSWCA 5, the first paragraph of which reads: "This is yet another appeal from the District Court that must succeed by reason of the manifest inadequacy of the trial judge's reasons. The authorities that govern judges' duties to give reasons are, or should be, permanently engraved in the minds of all judicial officers. These duties are designed to ensure that a judge wrestles adequately with the issues in the case, to enable appellate accountability and to provide basic fairness to the losing party. Judges should be as familiar with these duties as they are with the route they travel each day to work. Unhappily, however, some still get lost." 3 That paragraph is apposite to this case. Indeed, the trial judge made little effort to embark on the road required to discharge the judicial obligation to give reasons according to law. The fact that a case of this kind follows so soon after Whalan is a matter of concern. 4 Like Whalan, this case involves an assessment of damages in a personal injuries case where liability was not in issue. The respondent was the plaintiff in the proceedings below and the appellant was the defendant. The respondent's claim arose out of a motor vehicle accident that occurred on 10 November 2000. The respondent was driving a car that collided with another car. The appellant conceded liability for the negligence of the driver of the other car. 5 Black DCJ opened his judgment with the following observation: "The central issue for determination is the extent and nature of any injury and symptoms from [any] injury to [the respondent's] lower back and whether if there be such injury it was causally related to the accident."

Mr Campbell SC, who together with Mr McCarthy appeared for the appellant, described the issue whether the respondent injured her back in the car accident as "a governing fact in the case". Mr Roberts SC, who together with Mr Foord appeared for the respondent, agreed with this description. Indeed, the respondent's written submissions described the proceedings as "a single issue case"; the single issue being "whether the respondent's lower back was injured in the subject motor accident". 6 The trial ran over seven days. Written submissions were filed. Six witnesses gave oral evidence. The witnesses included three medical experts who had provided written reports. They were Dr Bleasel, a neurosurgeon, Mr Patrick Cormack, a physiotherapist, and Dr Lew Pierides, a specialist occupational physician. Dr Bleasel and Mr Cormack testified on behalf of the respondent and Dr Pierides on behalf of the appellant. The other three witnesses who gave oral evidence were the respondent, her husband (Mr Kostic) and her friend, Mrs Milinkovic. 7 Several medical reports were tendered as exhibits at the trial. On my count the respondent tendered 17 medical reports from 11 medical practitioners. The appellant tendered some 28 medical reports from 18 medical practitioners. In addition, there were several pages of medical notes and other documents relating to the medical issue before the Court. 8 The respondent gave evidence and was cross-examined at length. The cross-examination was aimed, amongst other things, at establishing that the respondent first complained about her lower back several weeks after the motor vehicle accident and in attempting to show that the pain in the lower back was not nearly as severe as she asserted. 9 Dr Bleasel and Dr Pierides were the main protagonists in the dispute as to whether the accident caused the pain in the respondent's lower back. Dr Bleasel testified that the accident probably caused the lower back pain. Dr Pierides was of the contrary opinion. 10 Mr Cormack's evidence was relevant to the date on which the respondent first complained about her lower back pain. This date was important as the crux of the dispute between Dr Bleasel and Dr Pierides concerned the delayed onset of lower back pain that the respondent had experienced. These two doctors expressed differing views as to the implications that arose from the delay. Mr Cormack's testimony tended to prove that the delay was not as lengthy as Dr Pierides had assumed (on the basis of what he had been told by the respondent). 11 Other medical practitioners supported the respondent's contention that she sustained her lower back injury in the accident. There was, however, a serious issue as to whether these practitioners had been told that there had been a delay (at least from the date of the accident on 10 November 2000 to 5 December 2000 when she saw Mr Cormack) before she reported the lower back pain. The doctors (other than Dr Bleasel) who supported the respondent in this respect appeared to assume that she had experienced pain in her lower back immediately or very shortly after the accident and had reported this fact. Whether she had suffered such pain shortly after the accident (and the degree of such pain) was in dispute. She did not report such pain to any medical practitioner until - on the evidence of Mr Cormack - 5 December 2000. 12 Dr Bleasel, in a report dated 8 July 2003, acknowledged that Dr Harvey-Sutton (a consultant occupational physician whose report was tendered by the appellant) also did not regard the respondent's back pain as a symptom caused by the motor vehicle accident. Dr Harvey-Sutton's unchallenged report therefore supported the opinions expressed by Dr Pierides. 13 In order to resolve the important dispute between Dr Bleasel and Dr Pierides, the judge first had to determine a number of critical factual issues. Firstly, when the respondent first experienced lower back pain. Secondly, the degree and extent of the back pain she first experienced and how that pain progressed. Thirdly, when the respondent first reported experiencing lower back pain to a medical practitioner. 14 The judge then had to resolve the difference in opinion between the doctors. This was not a credibility issue. The judge specifically found that Dr Pierides "was not in any way seeking to deceive the Court about anything". The issue was a medical question and was clearly defined by the differing opinions the doctors had expressed in their reports and in their oral evidence. 15 In one of his reports, Dr Pierides stated: "The back complaint, although possibly reported to the physiotherapist at the first assessment, was not reported to a medical practitioner until some ten weeks after the accident. Therefore, I am still of the opinion that no significant low back injury occurred in the subject accident. She may have had some jarring to her low back but I believe that it was not significant and she did not complain of this to her doctor for ten weeks. With respect to the question as to whether her lumbar disc pathology was caused in the subject accident it is my opinion that if there was significant enough trauma to her low back to have caused lumbar disc pathology of the nature of a lumbar sacral disc prolapse she would have felt back pain immediately. It would appear incongruous that significant trauma occurred that caused her a disc injury yet she didn't mention any back pain to her doctor for ten weeks. In my opinion this is not consistent. … The relevance of the lumbar sacral disc lesion to alleged symptoms is questionable. Even so, if the lumbar sacral disc lesion was caused in the subject accident there is no doubt in my mind that she would have complained of back pain to her doctor quite soon after the accident, within the first day or so, and would have required some treatment and have been somewhat disabled by back pain. This clearly was not the case." 16 Dr Bleasel expressed the opinion that "the low back pain came on when [the respondent] subjected the low back to more activity than she had in the early days after her accident and I cannot see any problem about the slightly later onset". Thus was the issue as to causation joined. 17 Black DCJ, however, failed to identify the issues in this way. Despite the approximately 45 medical reports, other documentary evidence and more than 300 pages of transcript of oral evidence (given over seven days), directed principally to these issues, the judge's reasoning on the principal issue in the case occupies less than one page. It is as follows: "During her evidence I did form a view that the Plaintiff was not as precise as one would have liked and of course I have to be aware of the possibility that such lack of precision was caused by a concern to avoid precision and being found to have been exaggerating or to have completely misstated relevant matters. However I also had the advantage of seeing Mrs Milinkovic and the Plaintiff's husband of hearing from Dr Bleasel and Mr McCormack and accordingly I am satisfied that it is appropriate to approach the Plaintiff as a truthful and reliable person as to what happened to her in the accident and the consequences thereof. I was particularly impressed by Mrs Milinkovic who if anything tendered to understate the problems and symptoms faced by the Plaintiff and overall I am satisfied there was no exaggeration. I was also assisted by Mr McCormack's evidence which I accepted and I also accepted Dr Bleasel's evidence particularly where it conflicted with that of Dr Pierides. As far as Dr Pierides is concerned he was not in anyway seeking to deceive the court about anything. His views were based on his assessment and interpretation of the material placed before him which at the time was incomplete and also the view he formed of the reliability of the Plaintiff. In the result as I have already said I disagree with him as to the assessment to be made of the Plaintiff's reliability. Accordingly I am satisfied that she sustained a disabling injury to her lower spine which has left her suffering significant discomfort and has adversely affected her future employability so as to give rise to a continuing loss." 18 When read literally, the judge's reasons for accepting the respondent as a truthful and reliable witness (despite lengthy cross-examination and inconsistencies and vagueness in her evidence) were the following:

(a) The judge saw Mrs Milinkovic and Mr Kostic and was impressed by Mrs Milinkovic.

(b) The judge heard from Mr Cormack and was assisted by Mr Cormack's evidence, which he accepted.

(c) The judge heard from Dr Bleasel and accepted his evidence, particularly where it was in conflict with that of Dr Pierides. That is, notwithstanding the fact that, as the judge observed, Dr Pierides was not in any way seeking to deceive the Court about anything. (d) According to the judge, Dr Pierides' views were based on his assessment and interpretation of the material placed before him which at the time was incomplete, and also the view he (Dr Pierides) formed of the reliability of the respondent. "In the result" the judge disagreed with Dr Pierides as to the assessment to be made of the respondent's reliability. 19 There are many difficulties with the reasons so expressed. 20 The first point to notice is that the judge made no express findings as to what I have described as critical factual issues. These concerned the date when the respondent first experienced lower back pain, the degree and extent of the back pain she first experienced and the progress of the pain, and the date when the respondent first reported to a medical practitioner that she was experiencing lower back pain. It is not possible to determine whether the judge addressed these issues in an informed and appropriate way (or at all). It is also not possible to comprehend how, without making findings on these issues, the judge could properly resolve the medical dispute between Dr Bleasel on the one hand and Dr Pierides (supported by Dr Harvey-Sutton) on the other. 21 Secondly, Mrs Milinkovic gave no relevant evidence as to the critical question concerning the time when the respondent first began to suffer from low back pain and the extent of that pain. Her evidence adds nothing to the fundamental dispute in the case. 22 Thirdly, Mr Kostic said merely that in the "days and weeks following her discharge from hospital" the respondent complained of "her arms, sometimes it would be her back, her legs, her neck". His evidence, falls into the same category as that of Mrs Milinkovic. 23 The fourth difficulty concerns the degree to which the judge was assisted by the evidence of Mr Cormack. 24 Mr Cormack, a physiotherapist, testified (in evidence that was challenged by the appellant) that, from notes and markings he made on a body chart at a consultation he had with the respondent on 5 December 2000, he inferred (in effect) that she had told him then that she was suffering from pain in the right side of the lower back. Mr Cormack was also able to infer from his notes that the respondent had told him that she felt pain in her lower back two days after the "initial injury". 25 Mr Cormack did not treat the respondent for pain in her lower back. He explained: "I would have probably ascertained from the patient that the priority area as far as they were concerned was the neck and so I would have commenced treatment on the neck and the shoulder and I probably intended eventually to examine the lower back in due course but it was probably just due to time constraints. The initial examination takes some time and sometimes we don't get through a full examination." 26 Mr Cormack had earlier, by letter dated 19 April 2001, advised the respondent's general practitioner that when he saw the respondent on 5 December 2000 she complained of "neck pain and headaches sustained in a motor vehicle accident on 10 November". He did not then refer to any pain to the lower back. When this was put to Mr Cormack in cross-examination he explained that he "had never examined or even directed any subjective examination towards that particular problem". He said that he "focused on the neck and the shoulder pain and headache". He was asked whether the areas that he had treated "would have been prioritised in accordance with the level of symptomatology complained of by the patient" and he replied "that's right and also the request of the doctor". 27 Undoubtedly, his Honour was entitled to accept Mr Cormack's evidence that the respondent had told him that the lower back pain had come on two days after the accident and that she had told him about lower back pain at the consultation of 5 December 2000. 28 The acceptance of that evidence, however, does not assist greatly in resolving the causation dispute concerning the respondent's lower back pain. 29 Dr Pierides expressed the opinion that, had her lower back pain been caused in the accident, the respondent would have complained of that pain to her doctor within the first day or so after the accident, she would have required some treatment and she would have been "somewhat disabled" by the back pain. On this evidence, the mere statement by the respondent to Mr Cormack (recorded in his notes but not in his first letter to the respondent's general practitioner), that she had told him on 5 December 2000 that she had felt back pain two days after the accident may not be of any moment. 30 No other medical practitioner recorded or recalled the respondent making such an assertion. On the contrary, the respondent told Dr Pierides that she had first suffered lower back pain six weeks after the accident and she had confirmed this to Dr Harvey-Sutton. This gives rise to the possible inference that the lower back pain about which the respondent told Mr Cormack was trivial and not pain of the kind that Drs Pierides and Harvey- Sutton regarded as relevant. Such an inference could also be made about Mr Cormack's note of the pain she told him about on 5 December 2000, as he neither treated the respondent for such pain nor told her general practitioner about it. The tenor of Dr Pierides' evidence is that had the pain been caused by the accident it would have come on within a day or so and would have been regarded as significant by the respondent. That was not the case with the pain reported to Mr Cormack. 31 The respondent did not say that she had complained of lower back pain to her doctor within the first two days after the accident, she was not treated for that pain (not even on 5 December 2000), and she did not assert that she was disabled by lower back pain within the time period in question. These are matters that Dr Pierides regarded as critical to the causative link between the accident and the respondent's condition. 32 The judge did not refer to the matters I have recounted above and the inference is that he did not bear them in mind. 33 Fifthly, as to "hearing from Dr Bleasel", it is by no means clear how that fact assisted the judge in determining whether the respondent was a truthful and reliable witness. Dr Bleasel's evidence, in regard to the critical issue, went to the question whether, despite the delay in experiencing pain and reporting pain to a doctor, the lower back condition was caused by the accident. While Dr Bleasel's evidence might support the causation issue, it cast little light on the respondent's credibility. 34 The sixth difficulty concerns the rejection of Dr Pierides' opinion. 35 The explanation given by the judge for stating that he "accepted Dr Bleasel's evidence particularly where it conflicted with that of Dr Pierides" was that the views of Dr Pierides "were based on his assessment and interpretation of the material placed before him which at the time was incomplete" and also because of "the view he formed of the reliability of the plaintiff". This explanation, however, is not sound. 36 The judge provided no detail as to the respects and extent in which Dr Pierides's assessment and interpretation of the material placed before him was incomplete. 37 If the judge was referring to the evidence of Mr Cormack, Dr Pierides - as I have indicated - stated in clear terms that, accepting the truth of what the respondent told Mr Cormack, the pain described was not sufficient to establish a causative link between the accident and the condition of which the respondent complained. Accordingly, Mr Cormack's evidence does not, on its face, detract significantly from Dr Pierides' opinion. Dr Pierides testified that Mr Cormack's testimony did not cause him to alter his opinion as to causation. 38 Dr Pierides's view of the reliability of the respondent was based on his observations as to the respondent's behaviour at his rooms and on examination as well as his medical knowledge and experience. It was not based on "demeanour", as a judicial officer uses that term to explain his or her credibility findings. 39 In his report dated 22 March 2002, Dr Pierides expressed the opinion that, with reference to the respondent's cervical and lumbar spine, she belonged to "Diagnostic Related Estimates, category 1" which he equated to "0% whole person permanent impairment". He said: "The reason for my opinion is there was no muscle spasm or guarding. There were no radicular signs. There were no significant clinical abnormalities. There was no evidence on investigation of any serious derangement of the cervical or lumbar spine".

In his report of 7 July 2005, Dr Pierides repeated this opinion. He referred to "pain behaviours" by the respondent and a restricted range of motion that, in Dr Pierides's opinion, were "not consistent with any particular physical injury". He said: "I was of the opinion that she was deliberately fabricating her complaint. I didn't feel that she had a pain problem as such as her presentation was far too contrived".

He said further: "Her condition is not consistent with the accident and any possible injuries that may have occurred in the accident."

Later, in the report, he said: "She did not appear to be under-utilising her body in any way. Her presentation was not consistent and most likely was deliberately fabricated."

He repeated that there "were significant inconsistencies in her presentation". 40 Dr Harvey-Sutton, in a report dated 24 April 2003, supported Dr Pierides' opinion as to the reliability of the respondent. Dr Harvey-Sutton said in this report she said that she had observed the respondent in the waiting room and also in the consultation room. There, she had a normal posture and an "initially normal gait". In the consultation room, however, "there was a limp displayed both before and during the examination". Dr Harvey-Sutton said: "On formal examination of gait [the respondent] displayed an antalgic gait, favouring the right leg." 41 Dr Harvey-Sutton also noted (like Dr Pierides) that, with regard to the thoraco-lumbar spine, there was no evidence of muscle guarding or spasm. 42 When dealing with the respondent's complaints about shoulder pain, which she said had endured for some lengthy period, Dr Harvey-Sutton pointed out that ultrasound reports of the left shoulder showed no abnormality and said that she would have expected "some muscle wasting in or about the shoulder girdles after more than two years". Dr Harvey-Sutton found that on inspection of the shoulder girdle there was no asymmetry or deformity. Dr Harvey-Sutton noted that there was no abnormality in either shoulder joint and the respondent had a full range of movement of her shoulders. 43 In these circumstances, that is, where two medical specialists have expressed the opinion that, from their observation of a patient's behaviour and their examination of the patient, the patient is pretending to have injuries that she does not have, it is not open to the judge to reject that evidence simply on the view - formed from the demeanour of the patient in the witness box - that she was a reliable witness. The judge's belief as to the credibility of a witness, based merely on the witness's demeanour in the witness box, is not a complete answer to a medical opinion based on observation of the witness in the waiting room and on clinical examination. 44 Of course, it is open to a judge to reject such medical opinion, but such rejection must be based on other grounds (for example, the unreliability of the doctor's observations, or the credibility of the doctor as a witness, or non-acceptance of the expert views expressed). But the judge cannot reject those views simply because the judge thinks, by reason of the patient's demeanour in the witness box, that the patient is a truthful witness. Indeed, if the doctor's opinion cannot be rejected on appropriate grounds, that opinion may speak volumes about the credibility of the witness. I have elsewhere expressed the inherent unreliability of credibility findings based on demeanour alone: Goodrich Aerospace Pty Limited v Arsic [2006] NSWCA 187. 45 Thus, the judge's reasons for rejecting the opinion of Dr Pierides were erroneous. 46 I would add that Dr Pierides gave a further reason for concluding that the respondent's lower back pain was not caused by the accident. This was his opinion that the mechanism of the accident, as described by the respondent, was unlikely to have caused an injury to the back. This is not a matter to which the judge referred. 47 Finally, on this issue, I have mentioned that Dr Harvey-Sutton was of the same view as to the causation question as Dr Pierides. The judge made no reference to her opinion in this regard. 48 Mr Roberts had the unenviable task of supporting the judge's decision and explaining how he arrived at it. He acquitted himself valiantly. In summary, his argument was as follows:

(a) It is plainly reasonable to accept Mr Cormack's documents as genuine, having been prepared at the time of his consultation with the respondent, and there was no need to explain that finding because it spoke for itself.

(b) Thus, it has to be assumed that the judge found that on 5 December 2000 Mr Cormack was told about lower back pain and was told, on that date, that it had begun two days before the accident.

(c) On that basis there is inaccuracy in the history assumed by Dr Pierides (albeit that the respondent had told him that the pain had begun six weeks after the accident).

(d) On that basis there was sufficient reason to prefer Dr Bleasel's testimony to that of Dr Pierides.

(e) The corroboration afforded to the respondent by Mrs Milinkovic and Mr Kostic on other matters was sufficient to support a finding that, in a general way, her complaints were reliable.

(f) The observations of Dr Pierides were not of a decisive and important character and did not require the judge to refer to them.

(g) The respondent gave evidence in chief that she felt pain in her back, particularly in the lower back. 49 This argument, albeit that it is the best that could be advanced under the circumstances, is not persuasive. 50 Firstly, even if the propositions in sub-paras (a) and (b) above are accepted, the fact remains that Dr Pierides asserted (more than once, and unequivocally) that even if what Mr Cormack said is correct, and even if the respondent suffered pain in her lower back two days after the accident and on 5 December 2000, his opinion as to causation remained unaltered. I have set out above his detailed reasons for coming to this conclusion. In summary, they were that, for the accident to have caused the lower back pain, the respondent would have complained of such pain to her doctor within the first day or so after the accident, would have required some treatment and would have been somewhat disabled by back pain. According to Dr Pierides, the respondent may simply have jarred her back in the accident. These are matters that the judge simply did not address. 51 Secondly, as I have mentioned, the judge made no reference to Dr Harvey-Sutton's opinions. 52 Thirdly, the reasons given by the judge for relying on the testimony of the respondent were, in several respects wrong and in other respects unconvincing (as I have explained above). That being the case, Dr Bleasel's opinion is open to question, as he relied - virtually entirely - on the respondent's account of her symptoms. 53 Fourthly, Mrs Milinkovic and Mr Kostic did not support the respondent on the crucial issue. The fact that the respondent was telling the truth about some matters does not mean that she was telling the truth about the governing fact in the case. 54 Fifthly, the observations of Dr Pierides as to the behaviour of the respondent in his waiting room and on examination, and his clinical findings (and those of Dr Harvey-Sutton) were crucial to the reliance to be placed on the respondent's overall credibility and, in particular, to her description of her symptoms. The judge, in order to discharge his obligation to give proper reasons, was required to deal with them. He did not. 55 Sixthly, the respondent's evidence on the question of her lower back injury was confusing, unclear and given in broad, descriptive terms. 56 In Whalan, the Court (at [40]) said: "All in all, the judge's reasons did not engage with the case presented by Ms Whalan. The omission on the part of his Honour to deal with so much material evidence denied "both the fact and the appearance of justice having been done" (per Samuels JA in Mifsud v Campbell (1991) 21 NSWLR 725 at 728). To paraphrase Samuels JA in that case, this has worked a miscarriage of justice, has produced a mistrial, and is reviewable on appeal. The omission of the judge to refer to evidence that was important and indeed critical to the proper determination of the matter gives rise to the inference that he overlooked the evidence or failed to give consideration to it: Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430 at 443 per Meagher JA." 57 These remarks apply equally to the judge's reasons concerning the question whether the accident caused the respondent's lower back pain. 58 In my reasons in Goodrich Aerospace Pty Limited v Arsic (with which Mason P and Tobias JA agreed), I said (at [28]): "It is not appropriate for a trial judge merely to set out the evidence adduced by one side, then the evidence adduced by another, and then assert that having seen and heard the witnesses he or she prefers or believes the evidence of the one and not the other. If that were to be the law, many cases could be resolved at the end of the evidence simply by the judge saying: "I believe Mr X but not Mr Y and judgment follows accordingly".

The judge's reasons on the main issue in this case come close to this description; I would add, however, that the judge did not even set out the evidence adduced by each side. 59 In Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430, Meagher JA (at 443) commented on what he described as the "fundamental elements of a statement of reasons". Two of these elements are particularly apposite in this case. Firstly, a judge is required to refer to relevant evidence. Meagher JA said in this regard: "There is no need to refer to the relevant evidence in detail, especially in circumstances where it is clear that the evidence has been considered. However, where certain evidence is important or critical to the proper determination of the matter and it is not referred to by the trial judge, an appellate court may infer that the trial judge overlooked the evidence or failed to give consideration to it … Where conflicting evidence of a significant nature is given, the existence of both sets of evidence should be referred to."

Secondly, a judge should set out any material findings of fact and any conclusions or ultimate findings of fact reached. Where reference is not made to findings of fact, an appellate court may infer that the trial judge considered the finding to be immaterial. Where one set of evidence is accepted over a conflicting set of significant evidence, the trial judge should set out his or her findings as to how he or she comes to accept the one over the other. This does not mean that a judge must make explicit findings on each disputed piece of evidence, especially if the inference as to what is found is appropriately clear. 60 The reasons given by the judge in this case in regard to the main issue fell hopelessly short of what was required. 61 In Waterways Authority v Fitzgibbon (2005) 79 ALJR 1816, Hayne J said at 1835, [130]: "Rather, because the primary judge was bound to state the reasons for arriving at the decision reached, the reasons actually stated are to be understood as recording the steps that were in fact taken in arriving at that result. Understanding the reasons given at first instance in that way, the error identified in this case is revealed as an error in the process of fact-finding. In particular, it is revealed as a failure to examine all of the material relevant to the particular issue."

Applying this test, there are many errors of fact-finding in the reasons relating to the main issue in the case. 62 I turn now to the judge's reasons in regard to the different heads of damage claimed by the respondent. 63 In regard to past economic loss, the judge said: "[The respondent] claims economic loss from the date of the accident to date totalling $34,752. That is a claim of modest proportions based on making allowances for the fact that she was looking after her teenage son and would not have engaged in full-time employment and claims an amount of $52,170 from which we [sic] deducted estimated net earnings for various periods as detailed in the claim. In my judgment the basis of the claim is appropriate and reasonable and making some adjustment from the fact that the total claim is calculated up until 20 April 2006 whereas this judgment is dated 11 May 2006 I award the sum of $35,000 for past economic loss." 64 There are, again, a number of fundamental difficulties with these reasons. 65 Firstly, in her evidence-in-chief, the respondent said that she was looking after her son and, had the accident not occurred, she was thinking of working full-time when her son was "bigger and grown up and he doesn't need much help from me". She did not say when her son would be old enough for her to be able to work full-time. The respondent was also under pressure from her husband to assist him in his business and in fact at some point she did assist him in his business. At that point, her earnings dropped. His Honour makes no specific finding concerning these significant matters. 66 The evidence of the respondent on this issue was confused but one thing is clear, there was no basis on which she could have been awarded damages on the assumption that she would have done more than part-time work until the date of the hearing. 67 The respondent earned $14,594 gross in 1998, $8,200 gross in 1999 and $5,928 gross in 2000. The judge's award for past economic loss assumes that, had the respondent not been injured, she would have earned $200 gross per week ($180 net per week). This was considerably more than she earned in the two years before the accident (although less than what she earned in 1998). No explanation is given for not giving more weight to the respondent's earnings during the two years prior to the accident. 68 Moreover, the appellant contended at trial that the respondent had a considerable residual earning capacity. Dr Pierides expressed the opinion that she could return to all activities. Dr Giblin, an orthopaedic surgeon called by the respondent, said (in a report dated 7 September 2001): "I would regard her condition as stable and that there is an ability for her to engage in a sedentary work environment."

There was other medical evidence to similar effect. The judge made no mention of this argument and the evidence on which it was based. 69 Another factor that the Court failed to take into consideration in regard to this head was that the respondent made no attempt whatever to attempt to find part-time work. She had in the past undertaken activities as a bookkeeper, she assisted her husband in his business in this regard and she agreed that there was nothing that "physically" prevented her from doing that work. 70 In summary, the judge's reasoning in regard to past economic loss was virtually non-existent and the finding itself was open to serious criticism inasmuch as it failed to take into account the matters to which I have referred. 71 The judge's reasoning in regard to future economic loss was even sparser. He said: "As far as future economic loss is concerned this is claimed at the rate of $200 per week and after applying the appropriate multiplier and after allowance for vicissitudes gives a total of $135,422. In my judgment that is a reasonable basis for the claim and I award that figure."

All the criticisms that apply to the findings in regard to past economic loss apply to future economic loss. There was simply a complete failure by the judge to engage with the evidence and the argument presented by the appellant in this regard. 72 In dealing with claims for care and assistance, the judge said: "As far as past care and assistance is concerned I accept the calculations made on behalf of the [respondent] namely 8.15 hours per week and I am told that the rate claimed was $16.05 per hour which may be less than the appropriate rate, however, making some allowance for the fact that judgment in this case will be delivered a further three weeks from the period calculated on behalf of the [respondent] I award the sum of $37,237 under this head. As far as future care and assistance is concerned I consider the basis should be 3 hours per week at $30 per hour. Applying a multiplier of 961.5 that gives a figure of $86,535." 73 Section 128 of the Motor Accidents Compensation Act 1999 (NSW) provides: "(1) Compensation, included in an award of damages, for the value of attendant care services: (a) which have been or are to be provided by another person to the person in whose favour the award is made, and (b) for which the person in whose favour the award is made has not paid and is not liable to pay, must not exceed the amount determined in accordance with this section. (2) No compensation is to be awarded if the services would have been provided to the person even if the person had not been injured by the motor accident. (3) No compensation is to be awarded if the services are provided, or are to be provided: (a) for less than 6 hours per week, and (b) for less than 6 months." 74 The judge made no reference to this section. Mr Roberts submitted that there was evidence on which the judge could have relied to establish that, as regards past care, the respondent received voluntary assistance of more than six hours per week for a period in excess six months prior to the trial. This issue, however, was not mentioned by the judge and he made no findings in regard to it. The inference is that he had no regard to the threshold. 75 The judge made a finding that the respondent needed future care and assistance in the future of three hours per week. This did not exceed the threshold under s 128(3). Mr Roberts pointed out that the threshold under s 128(3) applies only to services provided free of charge. There was, however, no evidence from the respondent that she intended to hire commercial carers and incur costs in consequence. Again, the reasoning supporting this award is virtually non-existent and issues that are critical to the respondent's entitlement to the award are not addressed. 76 In Goodrich Aerospace Pty Limited v Arsic, I said (at [29]): "Often important issues of credibility involve sub-issues. Often, objective facts, or facts that are probable, are capable of having significant bearing on the sub-issues. In cases of this kind, it is incumbent upon trial judges to resolve the sub-issues and to explain, by reference to the relevant facts, the conclusions to which they have come. This having been done, they should then turn to the ultimate facts in issue and explain how their decisions on the sub-issues have assisted them in forming a conclusion on the ultimate issue. It is only when adequate reasons of this kind are given that an unsuccessful party will be able to understand why the judge has believed his or her successful opponent". 77 Appropriate findings in regard to the different heads of damage required the judge to determine a number of sub-issues before deciding on the ultimate issue in respect of each head. This was not done. 78 In the circumstances the appeal must succeed. There was evidence on which a court could have found for the respondent but in the way the reasons were formulated the judgment must be set aside. Again, comments made in Whalan are apposite. There the Court (at [42]) said:

"The criticism of the judge contained in this judgment may be thought to be severe, but the inadequacy of reasons is not an infrequent issue in this Court with respect to appeals from the District Court. The parties in the present case have been put to unnecessary expense in litigating the appeal and will be put to further expense in conducting a new trial on the assessment of damages. Furthermore, in such cases plaintiffs such as Ms Whalan may be kept out of a proper verdict over a lengthy period to which they would have had access had the judgment complied with the basic principles of judicial reasoning." 79 These remarks apply equally in this case. The expense of the seven-day trial with full submissions must have been high indeed. It is obvious from the evidence that the respondent is not a person of means. The pressure on her to finance a new trial will be severe, and there will inevitably be a high emotional cost and great inconvenience. She will have suffered serious prejudice. The case will have to be remitted through no fault attributable to her or her legal representatives. 80 I propose that an order be made that the respondent be entitled to a certificate under the Suitors' Fund Act 1951 (NSW). That, however, will not fully compensate her for what has occurred. In Darke v El Debal [2006] NSWCA 86, Mason P (with whom Santow and McColl JJA agreed) said at [103]: "It is well known that a certificate under the Suitors' Fund Act is less than a full indemnity. It is particularly disturbing in the present case given that the conduct of the parties at trial has in no way contributed to the litany of errors patent in the judgment below. I propose that the Registrar be directed to send a copy of this judgment to the Attorney General with a request that he give favourable consideration to an ex gratia payment covering so much of the costs of the trial as were thrown away in consequence of the manner in which the issues were handled in the judgment."

A similar direction should be given in this case. 81 There is one final matter with which I need to deal. The very many medical reports are contained in the blue book but no proper index was made in regard to them. All that is to be found is an item entitled "bundle of plaintiff's medical reports" (that run from pages 14 to 117) and an item entitled "bundle of defendant's medical reports" (that run from pages 258 to 364). The appeal turned to a significant extent on what was contained in the medical reports. Close attention was given to them in preparation for the appeal, during the course of argument and while preparing this judgment. This examination was seriously hampered by the absence of a proper index in accordance with the prevailing practice. During the hearing, the appellant's solicitors quite properly accepted that there had been an error of judgment on their part in preparing the medical reports in this fashion. They agreed that an order should be made that they should bear the costs of the blue book, that is, the costs of the blue book would not be recoverable from the respondent or the appellant. 82 I propose the following orders:

(b) The judgment of Black DCJ is set aside. The assessment of damages is remitted to the District Court for rehearing as a new trial.

(c) Save as regards the costs of the blue book (those costs not being recoverable from the appellant or from the respondent), the respondent is to pay the costs of the appeal.

(d) The respondent to have a certificate under the Suitors' Fund Act 1951 (NSW), if otherwise entitled.

(e) The registrar be requested to send a copy of this judgment to the Attorney General with a request that he give favourable consideration to an ex gratia payment covering so much of the costs of the trial as were thrown away in consequence of the manner in which the issues were handled in the judgment. 83 CAMPBELL JA: I agree with Ipp JA. **********

16/02/2007 - Attaching judgment - Paragraph(s) judgment attached

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