Court of Appeal (Vic)|2013-02-19|Before: Tate JA, Whelan JA

Woolworths Ltd v Warfe [2013] VSCA 22 (19 February 2013)

Warfe v Woolworths (Vic) Pty Ltd [2011] VCC 1517

1 I have had the considerable benefit of reading in draft form the reasons of Kaye AJA. I agree with his Honour's reasons and the orders he has proposed.

2 I have read in draft form the reasons of Kaye AJA. I agree with His Honour's reasons in relation to all of the grounds other than ground 24. I agree with the orders he has proposed. Given our conclusion and our reasons for upholding ground 25, I consider that it is neither necessary nor desirable to determine ground 24.

3 This is an appeal against an order made by a judge of the County Court on 14 December 2011. By that order, the judge granted leave to the respondent, Ian Douglas Warfe, pursuant to s 134AB(16)(b) and (19) of the Accident Compensation Act 1985 to bring proceedings for damages in respect of injuries suffered by him in the course of his employment with the appellant between 2001 and 2004. Those injuries consisted of epicondylitis of each of the right and left elbows and a major depressive disorder.

4 The appellant relied on a number of grounds of appeal. The principal points concern, first, whether the trial judge made the findings necessary for the grant of such leave, secondly, whether the trial judge erred in accepting the respondent as a credible witness, and, thirdly, the adequacy of the trial judge's reasons for her decision.

5 The respondent was born on 24 July 1957. After leaving school, he worked in

a number of different capacities until 1987. Between 1987 and 2004, the respondent worked continuously with the appellant, in its Safeway stores, save for a period of approximately two years in the late 1990s, when he was incapacitated by a psychiatric illness. The respondent returned to work at the Newcomb store of the appellant in Geelong in early 2001.

6 On 3 May 2001, the respondent submitted a WorkCover Claim form for injury to his right elbow. That claim was accepted by the appellant, and weekly payments of compensation were paid to him. The respondent continued to work with the appellant. Subsequently, he submitted a WorkCover Claim in respect of injury to his left elbow, which had become symptomatic in about August 2004. That claim was also accepted by the appellant. In his application to the County Court, the respondent claimed a deterioration in the condition of both elbows, due to the work which he performed in his employment with the appellant between May 2001 and October 2004 at the appellant's Newcomb and Drysdale stores. In particular, the appellant claimed that while he was working at the Drysdale store between September 2003 and October 2004, his elbow injuries deteriorated because he was required to move pallets over a grate which caused vibration, banging and jamming of his elbows. Ultimately, the respondent was placed on light duties, which he continued to perform until he ceased work in October 2004.

7 The respondent also claimed that between September 2003 and October 2004 he was harassed, bullied and insulted by the store manager of the appellant, as a consequence of which he suffered psychiatric injury. The respondent submitted a WorkCover claim on 22 October 2004 in respect of the psychiatric injury. That claim was also accepted.

8 In March 2004, the respondent attended his general practitioner, Dr Jason Chan, in Deer Park, complaining that he was stressed and struggling mentally as a result of intimidatory behaviour by his boss at work. He described loss of appetite, insomnia and depressed feelings. Dr Chan commenced the respondent on a course of antidepressant medication. The respondent was able to cope with his employment for a further seven months, before he reached the point at which he could not continue working.

9 On 21 October 2004, the respondent attended Dr Chan and advised that he was feeling worse because of harassment in the work place. Dr Chan certified the respondent unfit for work and prescribed Efexor for his condition. He referred the respondent to Mr David Sullivan, a psychologist in Geelong. The respondent attended Mr Sullivan on 2 November 2004 for the first occasion. He detailed the history of recent workplace events, harassment, bullying and intimidation over an extended period of time by his store manager. Mr Sullivan then commenced a course of psychological treatment for the respondent, which continued until mid-2008 when the respondent moved to Nagambie.

10 In the meantime, in November 2004, Dr Chan referred the respondent to Dr Stephen McConnell, a consultant psychiatrist, for psychiatric opinion and treatment. Dr McConnell diagnosed the respondent to suffer from a moderate to severe major depressive disorder with panic disorder, agoraphobia and social anxiety disorder. Dr McConnell found the respondent unfit for work duties. Dr McConnell treated the respondent over a period of consultations until 18 June 2007.

11 In 2008, the respondent moved to Nagambie. In December 2008, Dr Chan referred him to Dr Francis Payne, a psychiatrist practising in Kilmore. Dr Payne first saw the respondent on 16 December 2008. He noted that the respondent was taking a combination of Efexor and Avanza, and he made a diagnosis of major depression. The respondent has seen Dr Payne on a regular basis since that time. Dr Payne continued to prescribe medication for his condition. He changed the respondent's medication from Efexor to Cymbalta.

12 In his affidavit in support of his application to the County Court, the respondent claimed that since October 2004 he had been totally unfit for work. At the time at which he had ceased work with the appellant, he had been performing light duties. When he consulted Dr Payne on 16 December 2008, he said that he then had an unpaid position caretaking a property with seven boats on which he did some maintenance, and that he also did some gardening, in return for free accommodation. The work, performed by the respondent in that capacity, was the subject of video footage to which I shall later refer, and was also the subject of a substantial amount of cross-examination.

13 In his affidavit, the respondent claimed that his elbow injuries had had a significant impact on his social, recreational and domestic capacities. He said that he experienced difficulty performing simple tasks such as carrying milk home from the shop, and performing more strenuous tasks such as cleaning and gardening. He tended to protect his right elbow which is in worse condition than his left elbow. He stated that his psychiatric injury also had had a significant impact on his social, recreational and domestic capacities. He continued to experience anxiety and depression, and he did not believe that he would be capable of working in paid employment.

14 The respondent's evidence in chief in the County Court was presented by affidavit. As I have stated, he was cross-examined extensively. A number of medical reports were tendered on behalf of both the respondent and the appellant, together with vocational assessment documents. On the second day of the hearing, the respondent attempted self-harm, and he was conveyed to hospital. On the resumed hearing, Dr Payne was cross-examined as to the respondent's fitness to give evidence. Otherwise, there was no cross-examination of any of the medical practitioners as to the contents of their reports.

15 The central issue, raised by counsel for the appellant at the hearing, concerned the credit of the respondent as to his complaints of injury and disability. In particular, the appellant sought to demonstrate that the respondent had feigned the extent of disability sustained by him as a result of his injuries. The appellant, before the County Court judge, submitted that the consequences of the respondent's injuries were minor, and they fell well short of the required level to justify their characterisation as a serious injury.

16 In the hearing in the County Court, counsel for the appellant cross-examined the respondent on, and tendered, surveillance video evidence, with a view to demonstrating that the respondent had exaggerated his level of disability. The appellant also cross-examined the respondent with a view to demonstrating that at least in part his ongoing psychiatric issues had been contributed to by his bout of psychiatric illness in the late 1990s.

17 Before summarising the cross-examination of the respondent, it is useful, first, to summarise the effect of the medical reports and evidence which was tendered at the hearing.

18 Dr Chan reported that after he first saw the respondent, for depression, in March 2004, he continued to see the respondent on a monthly basis. The respondent was frustrated, angry and resentful towards the appellant, and blamed the appellant's lack of support for his current problems. He was frustrated that he could not work and he had difficulty going out in public. His condition declined rapidly, and his level of functioning deteriorated, when his partner, Gwen, had to be with her ill mother in Perth. In his last report dated 21 December 2006, Dr Chan was unclear as to the respondent's prognosis. His recovery would be dependent on his ability to find gainful employment and to be able to provide for his family, which would not take place in the foreseeable future. The respondent would continue to need psychological support and medication for an extended period of time.

19 By a report dated 28 March 2011, Dr Alan Kosky, of the Nagambie Medical Centre, stated that the respondent had been a patient of the practice since December 2008. The respondent first consulted Dr Kosky in January 2010. Dr Kosky said that he was treating the respondent for depression and anxiety which dated back to his work with the appellant, and in particular to the intimidation and verbal abuse to which he had been subjected in the workplace. The respondent had a depressed affect, he exhibited anxious behaviour such as picking at his skin, he was having difficulty making decisions, and he suffered from tiredness due to his insomnia. The respondent's depression and anxiety were consistent with the stress which he described in his workplace, and the long term prognosis was poor because of the persistence of his symptoms since 2004. The respondent was not fit for employment, and he had no current capacity for work. The respondent's treatment consisted of antidepressant and anxiolytic medication, together with regular psychiatric consultations with the clinic's mental health nurse.

20 On 5 July 2005, Mr Josh Hayter, physiotherapist, completed a physiotherapy treatment notification form for the Victorian WorkCover Authority. The form confirmed that the respondent had been referred to Mr Hayter by Dr Chan for treatment for pain in the right lateral elbow and upper limb dysfunction. The diagnosis was right lateral epicondylalgia and chronic pain.

21 Dr Stephen McConnell, psychiatrist, provided three reports, dated 11 February 2005, 16 January 2007 and 8 April 2011. In his first report, in February 2005, Dr McConnell considered that the respondent was suffering from a moderate to severe major depressive disorder with panic disorder, agoraphobia and social anxiety disorder. He said that during the period in which he had been treating the respondent since December 2004, he had been totally incapacitated from working. His short term prognosis was poor, but there had been some early signs of improvement.

22 In his report of January 2007, Dr McConnell again assessed the respondent to be suffering from a major depressive disorder with associated generalised anxiety and panic symptoms. On his last review with the respondent in November 2006, the respondent had significantly improved. However, his prognosis for work was relatively poor due to the respondent developing chronic social anxiety and social withdrawal. The respondent needed to find new meaningful work, outside of his home, because home based employment would perpetuate his social avoidance.

23 Mr Sullivan, the psychologist, provided three reports dated 7 December 2006, 23 March 2007 and 31 January 2008.

24 In his first report, Mr Sullivan noted that during 2005 the respondent made slow but steady progress towards improved psychological health, but that his functioning remained fragile. Subsequently, in October 2006, he noted a significant deterioration in the respondent's psychological functioning over the previous six weeks while his partner, Gwen, had been absent. The respondent's psychological function continued to deteriorate over the last four months of 2006, so that, by December 2006, he was suffering a severely disabling major depressive disorder.

25 In March 2007, Mr Sullivan continued to consider that the respondent suffered a severe and chronic major depressive disorder as a result of workplace harassment, intimidation and bullying to which he was subjected. The respondent was totally incapacitated for work and it was increasingly unlikely he would be able to make a successful and sustained return to any work for which he was qualified. The prognosis for his psychological functioning was uncertain.

26 In his last report of 31 January 2008, Mr Sullivan adhered to the same diagnosis, namely, that the respondent suffered a severe and chronic major depressive disorder because of his treatment at work. He suffered severe agoraphobic symptomatology, which impacted upon his capacity to manage the basic activities of living. In addition, he continued to suffer recurrent suicidal ideation. The respondent remained totally incapacitated for any work for which he was otherwise qualified. The respondent had initiated and participated in a rehabilitation program and that he had participated in all the rehabilitative activities arranged by the rehabilitation consultants. However, he was not fit for his pre-injury duties, and there was no suitable employment for him. The respondent had no prospect of any real world employment which could reasonably be offered to him.

27 In his report dated 13 July 2010, Dr Payne, the psychiatrist, noted that he had first seen the respondent on 16 December 2008 on referral by Dr Chan. Dr Payne considered that the respondent suffered from major depression, with symptoms of low mood, low motivation, and occasional suicidal ideation. Workplace stress and the respondent's perceptions of relationships between himself and his employers had contributed to the development of his depression or, as a minimum, to an exacerbation of a pre-existing tendency to depression. The respondent was then taking antidepressant medication. The respondent's prognosis would be for some improvement, but the process of recovery may well take a considerable time. With treatment, he would be likely to resume some form of employment in the foreseeable future, but that was by no means definite. At that time (July 2010), the respondent's condition had not fully stabilised, but he had improved over the previous year since his antidepressant medication had been changed to Cymbalta. He would continue to require further counselling and ongoing treatment by antidepressant medication. The respondent was not ready to return to work. His incapacity for employment would extend for at least six to twelve months. At times, he was almost totally incapacitated, but at other times he improved and was able to function at a reasonable level.

28 The respondent was also examined by Dr Michael Epstein, psychiatrist, at the request of his solicitor, in November 2010 and July 2011. On each occasion, Dr Epstein considered that the respondent suffered from a major depressive disorder with panic attacks, which was a result of bullying and harassment in his employment. His capacity for coping was very limited and he required ongoing psychiatric treatment. The respondent was unfit to return to his pre-injury duties or any other suitable work. His prognosis for improvement was poor.

29 The evidence concerning the respondent's injury to his arms was in brief compass. On 12 July 2005, he underwent an ultrasound to his right elbow, which revealed a small calcification within the tendon attached to the lateral epicondyle of the right elbow. There were then no current signs of acute inflammatory type changes involving the tendon or ligament.

30 Associate Professor Maurice Wallin, a consultant in occupational health and rehabilitation medicine, examined the respondent at the request of his solicitors on 1 September 2010. On examination, the respondent's right elbow had very significant tenderness in the lateral epicondyle, with significant stiffness and a degree of tenderness in the extensor muscle region. Professor Wallin considered that the respondent had very active right lateral epicondylitis, as well as left medial epicondylitis ('golf elbow'). The respondent also suffered major ongoing depression and anxiety relating to his work stress claim. There was a poor diagnosis for the respondent's left and right arm disability, as six years had passed since the original injury. As a result of his physical injury, he had no current capacity for any form of employment. In addition, from a psychological or social point of view, he was not fit to engage in any light work employment. There was a very high likelihood that the respondent's incapacity for employment was permanent.

31 Mr Garry Grossbard, an orthopaedic surgeon, examined the respondent, at the request of his solicitors, on 9 November 2010 and, subsequently, on 8 June 2011. On each examination, Mr Grossbard concluded that the respondent has bilateral epicondylitis. His prognosis for recovery was very guarded. In his first report, Mr Grossbard considered that the respondent had a capacity for employment, particularly if he was not required to lift or undertake repeated activities with his arms. However, a major impediment to him returning to work may be his psychological issues. In his second report, Mr Grossbard expressed the view that the respondent had very little capacity for employment, for both physical and psychological reasons. He doubted that the respondent would be able to undertake any duties on a fulltime basis, and the duties he could undertake would be purely sedentary and would not involve repetitive use of his arms. His capacity to cope with any employment would depend very largely on his psychiatric status.

32 The appellant had the respondent examined by a number of medical practitioners, whose reports were tendered in evidence in the County Court proceeding.

33 Dr John Douglas, psychiatrist, examined the respondent on 1 December 2004. He concluded that the respondent suffered a major depressive disorder precipitated by the stress, which he had experienced in his employment. The respondent's condition had not then resolved, and at that time he did not have a current work capacity. He considered that because the respondent had previously made a reasonable recovery from his psychiatric illness in 1999, he expected the respondent would recover again. However, major depressive disorders often recur, and it is likely that the respondent would become depressed again in the future.

34 In June 2005, the respondent was examined by Mr Steven Adlard, a consultant psychiatrist. Dr Adlard considered that the respondent was suffering from a major depressive disorder in partial remission. His condition was then of mild to moderate severity. Based on the respondent's history, Dr Adlard considered that he had a pre-existing psychiatric illness before 2000, which was probably in remission. Dr Adlard suspected that there would be gradual improvement over the passage of time with psychiatric and psychological support. The respondent was not fit to return to work at that time, and the respondent would not be able to return to work over the next three months. The main limitations to him returning to work were his lowered mood, his high levels of anxiety, particularly when going anywhere near a Safeway store, and his perceptions about the appellant. Dr Adlard did not consider that the respondent was exaggerating or embellishing his symptoms.

35 In July 2007, the respondent was examined by Dr Timothy Entwhistle, a consultant psychiatrist. Dr Entwhistle diagnosed a chronic adjustment disorder with anxiety, social avoidance, irritability and sleep disturbance. He considered that the respondent's chronic adjustment disorder limited his daily activities. He was socially avoidant, and was heavily reliant on his carer. His condition had shown some slow improvement following treatment.

36 The plaintiff was examined by Dr Dush Shan, consultant psychiatrist, on four occasions between February 2007 and March 2011. On each occasion, Dr Shan diagnosed that the respondent was suffering from a chronic major depressive disorder, which was likely to remain stable. He considered that the respondent's employment with the appellant had been a significant contributing factor to his illness and that it continued to be so. The respondent had no capacity for his pre-injury duties, but he was capable of suitable duties, where there is little interaction with unknown persons. Dr Shan read the vocational assessment report in respect of the respondent, and considered that he was capable of being a caretaker or a farm hand, but he was uncertain whether the respondent would be reliable as a computer repairer. The respondent could work in such an occupation for twenty hours per week after a slow start. It was likely that the respondent's incapacity would be for an indefinite duration, in light of his psychiatric history and the lack of any substantial response to treatment by medication.

37 In June 2007, Mr Peter Scott, a general surgeon, examined the respondent. Mr Scott considered that the respondent's employment with the appellant resulted in the development of a right lateral traumatic epicondylitis (tennis elbow) from which he has had a large measure of recovery, together with a probable left lateral traumatic epicondylitis from which a complete recovery had occurred. There was a normal range of movement of the elbow, and there was no evidence of any degenerative change in the elbow.

38 In May 2011, Mr Michael Dooley, orthopaedic surgeon, also examined the respondent. Mr Dooley considered that the respondent had developed lateral epicondylitis of the elbows in 2001. He considered that the constancy and intensity of the ongoing pain reported by the respondent were out of proportion to his condition. Mr Dooley noted that it was apparent, from the respondent's presentation and from the documentation available to him, that the respondent had suffered from significant depression. He considered that much of the respondent's current presentation related to his psychological condition. From an orthopaedic viewpoint alone, he would expect the respondent to note some intermittent elbow pain, but he would not expect that the respondent's condition would deteriorate in the future. Mr Dooley considered that the respondent would be capable of carrying out some light physical work such as clerical work, but he noted that the respondent did not have any previous training, which would fit him for such employment. He did not consider that the respondent had the capacity to work as a caretaker, farm hand or caravan park caretaker. Potentially, those jobs involved heavy physical activity. The respondent would be able to work as a computer repairer.

39 In February 2006, the respondent met with IPA Rehabilitation. At that time, the assessor considered that two employment options were identified, namely general clerical/administrative employment, and employment as a sales representative (internet/telephone based selling).

40 The vocational specialist recommended that the respondent commence a computer class at a local TAFE college, as that would assist in increasing the amount of social contact which the respondent currently had. That process was supported by Dr McConnell. The respondent completed a computer course, but there was no evidence that he had sought employment after that.

41 In March 2011, Ms Joanne Bryant, an occupational therapist, of Co Work Pty Ltd, carried out an assessment of the plaintiff's vocational capabilities. Ms Bryant considered that if the respondent could not cope with the routine of a formal employment, then work such as he was then performing as a caretaker might be suitable. If his symptoms improved, he might also be suited to work to repairing computers. She also considered that employment as a farm hand might be appropriate.

42 The respondent was cross-examined at some length, over the course of three days.

43 The respondent agreed in cross-examination that he had suffered from depression between 1998 and 2001, during which time he had not worked. He described the conflicts which he had experienced with other employees and managers of the stores at which he worked for the appellant, during his employment between 2001 and 2004.

44 When asked what work he had done since 2004, the respondent stated that he did some work on the property on which he lived. He said that he mowed some grass, and if there was a boat which required to be put out, he put it out. He also agreed that he did some gardening, and cut wood. He had constructed a vegetable garden with the help of his son and his father.

45 The respondent confirmed the extent of the disability to which he had deposed in his affidavit, and which I have already set out above. The respondent also confirmed, in cross-examination, the description of his disabilities which he had given to some of the medical practitioners, including to Associate Professor Wallin, Dr Shan, Mr Dooley and Dr Epstein. Counsel then played to the respondent a segment of the surveillance film relating to activities on 16 January 2011, in which the respondent was depicted transporting a load of canoes to a business called Nagambie Lakes Boat Hire. The respondent stated that on occasions when the canoe hire man was not available, he had filled in for him. He said that at the time that the film was taken, he was involved in hiring boats, and he also hired out canoes if the owner of the canoes did not attend from Kyabram. He took orders for the hire of the boats, and that on some occasions he received the payments for them. He said that he was looking after the boat hire business, but that he was not being paid for doing so. Rather, he did it for the purposes of 'social interaction'. He said that he was assisted in his work by his carer/partner, Gwen.

46 The respondent said that he had been involved in the activities involving the hiring of the boats from June 2008. The owner of the business lived in Kangaroo Flat near Bendigo. The respondent stated that he ran the business on a day to day basis from June 2008 until January 2011. He said that the work only involved two busy periods, namely Christmas and Easter, and sometimes on long weekends. He agreed that he worked from 10.00 am to 4.00 pm each day loading, unloading, launching and pulling boats back on shore as part of the running of the business.

47 The respondent agreed that the boat hire business was advertised on a tourism website. He said that he understood computers, but that he had never built a computer. He was not aware of any website for the Nagambie Lakes Boat Hire business. The respondent also agreed that he had helped out with the canoe business run by Mr Rob Asplin, when Mr Asplin was not at the park. He did that work in order to have more exposure to people, because his doctors had told him he must try to get out of the house more often. He had subsequently ceased assisting with the canoes in early 2011, because he had found that work too stressful.

48 It was suggested to the respondent that he had deliberately concealed the fact that he had worked for the boat hire business from doctors who had examined him, and from Ms Bryant, the rehabilitation specialist. The respondent denied that allegation.

49 The respondent was then shown a video taken on 16 January 2011, which depicted him bagging lifejackets, lifting a canoe, and carrying a fuel tank. He said that when he lifted the fuel tank, his arm was in a locked position. He said that the canoe was slid off the trailer, and he only lifted it for the last part of the manoeuvre. He denied that he performed the activities free of pain, and he said that the pain built up during the day.

50 The respondent was then shown further film of 16 January. He pointed out that he was wearing a brace, because he was then having trouble with his arm, which had started to swell. He said that it appeared on the film that his movements were unrestricted, but the film did not demonstrate that he was carrying out the actions, portrayed on it, free of pain.

51 The respondent was then shown a third segment of the film taken on 16 January 2011. He said that the film showed him lifting the canoe with his left arm, which was his better arm. He said that when the canoe comes out of the water, it is wet on the bottom, which means that it can be dragged more easily. The canoes weighed approximately 25 kilograms.

52 The respondent denied saying to Dr Shan in March 2011 that he had not worked. He said that if he had been asked about his work, he would have told Dr Shan of the work which he was performing with the boats.

53 The respondent was then shown another film taken on 27 and 28 January 2011. He agreed that he was depicted starting the outboard motor on a boat, and carrying a canoe using both arms. He said that the film did not show that most of the weight of the canoe was on his left arm. He agreed that he was also bucketing water out of the boat, but he said there were only two or three kilograms of water in each bucket load. He did some of that work with his right hand, but some with his left hand.

54 The respondent was then cross-examined about his consultation with Mr Michael Dooley in May 2011. He said that he had told Mr Dooley that he had difficulty using power tools, but that at times he is able to use a chainsaw to a limited degree. He agreed that some days he can use a chainsaw for fifteen minutes, and sometimes for half an hour, but on other days he could not even cut two pieces of wood. He again stated that the video did not depict the medication which he had taken on any particular day.

55 As I stated, Dr Payne gave evidence on the adjournment application, and he was cross-examined. The cross-examination travelled, to a limited extent, beyond the adjournment application, and canvassed issues relevant to the serious injury application.

56 In particular, in cross-examination, Dr Payne stated that the respondent had told him that, in addition to repairing and maintaining boats at Nagambie Lakes, he also assisted on a voluntary basis with some of the running of the boat hire business. Dr Payne did not understand the respondent to be conducting the business. Rather, he understood, from what he was told by the respondent, that he was doing that work occasionally on an unpaid basis. It was put to him by counsel that the true ambit of the respondent's activities included handling and hiring out boats, receiving payment and taking bookings. Dr Payne responded that, if that were the case, it would represent more activity than he had been led to believe. However, he rejected the proposition that, in such an event, he had been deceived by the respondent. He also rejected the proposition that the activities of dealing with customers, hiring out boats, and running the business, were inconsistent with his diagnosis that the respondent was suffering from major depression.

57 Video was taken of surveillance performed in respect of the respondent at different times, for a total period of approximately 79 hours, during seven days in 2008 and seven days in January 2011. In cross-examination, the respondent was shown approximately two hours of film of surveillance conducted on him on 16, 17, 19, 21, 27 and 28 January 2011. I shall summarise the video evidence later.

58 The trial judge commenced by setting out, in detail, the statutory provisions relevant to the respondent's application. Her Honour noted that the principal issue, raised by the appellant, concerned the credit of the respondent, and in particular the claim by the appellant that the respondent had feigned his disability.

59 The trial judge then set out, in some length, a summary of the evidence of the respondent, and of his cross-examination. She then summarised the respondent's medical evidence, the appellant's medical evidence, and the vocational assessments.

60 Her Honour observed (paragraph [63]) that only two hours out of the 79 hours of surveillance video evidence was shown to the respondent. She stated that she could therefore infer that the balance of the film, not shown to the respondent, would not have assisted the appellant. Her Honour then stated:

[64] I accept that a video is a snapshot in time and that a plaintiff with injuries as the plaintiff described may have days when he is able to do more activity than on other days. I accept that the surveillance showed the plaintiff had a greater range of movement than he described. I note that the activities the plaintiff was performing were non-repetitive and in an informal environment without supervision. However, the video says nothing about the psychiatric condition or the pain the plaintiff suffers.

[65] The plaintiff was consistent in reporting the injury and its causes to doctors whom he saw.

[66] The plaintiff gave his evidence in a detached manner and failed to convey to the court how the injury affected his life. The plaintiff took time to answer questions. He made concessions.

[67] He had difficulty answering questions in relation to information he gave to doctors in respect to his personal life in the late 1990s when he was being treated for depression. I consider that it was reasonable for the plaintiff to struggle to answer questions about events that occurred more than ten years ago and at a time when he was being treated for depression.

61 The trial judge then noted that all the medical witnesses accepted that the respondent's claimed injuries were related to his work. Her Honour considered that some of the older reports were relevant to the history of the respondent's condition. However, given the age of those reports, she was more influenced by the up to date medical reports of the respondent's current general practitioner, Dr Kosky, of his treating psychiatrist, Dr Payne, and the medico-legal reports of Dr Epstein, Dr Shan, Mr Grossbard, Associate Professor Wallin and Mr Dooley.

62 The trial judge then noted the fundamental submission by the appellant that, in view of the video evidence of January 2011, she should not rely upon the respondent's history of his physical or emotional problems, because the history, given by the appellant to the medical practitioners, was inconsistent with the level of activity in which he engaged as depicted by the video footage. Her Honour also noted the submission by the appellant that the respondent had not called evidence from the owner of the property where the boats were hired, the owner of the canoes, his carer (Gwen) or his son. Her Honour then stated:

[71] I accept there is no lay evidence to corroborate what the plaintiff has said as to his level of activity. The plaintiff gave consistent accounts of his condition to all medical witnesses whom he saw. All witnesses were given details of his prior episode of depression and anxiety. He volunteered information in cross-examination that showed his level of activity. That is, he built a vegetable garden with assistance and he repaired a down pipe and dug a channel. These are not the sort of admissions a plaintiff would make if his motivation was to deceive. Further, he had described to doctors the activities he undertakes at Nagambie Lakes. Accordingly I reject the submission of the defendant that I cannot rely upon the information the plaintiff has given to medical witnesses he has seen.

[72] Dr Payne was cross-examined and he said that after treating the plaintiff for three years, he considered he was genuinely depressed. He did not believe the plaintiff engaged in deceit in regards to his psychiatric history or condition. Dr Payne said the plaintiff was encouraged to undertake activities that would enable him to socialise. I accept that the film showed the plaintiff doing that ... .

[73] The plaintiff's evidence was that he had recovered from the earlier episode of depression and anxiety. It was accepted by all psychiatrists and psychologists that the plaintiff had suffered a mental condition due to his employment with the defendant. All were aware of the plaintiff's previous history. ... The current medical views described his condition as a very significant depression or, at a minimum, an exacerbation of a pre-existing tendency to depression (Dr Payne), a major depressive disorder with panic attacks (Dr Epstein), a chronic major depressive disorder (Dr Shan). Most accepted that the plaintiff's condition was long term given the fact that he had been suffering depression and anxiety since 2004.

63 Her Honour then set out the varying views by the medical practitioners, who gave evidence concerning his psychiatric state, as to the respondent's capacity to work. On that aspect, her Honour concluded:

[78] I accept that the current position he has as caretaker could not be equated to 'real world' employment. He derives no income from the position and can perform the jobs required of him in his own time. Those jobs are limited to riding on a ride on mower and taking care of the boats. I accept that the activities that the plaintiff is involved in are social activities that try to help the plaintiff feel more comfortable, but would not fulfil the key performance indicators of any job description (this view was accepted by Associate Professor Wallin). The best evidence is that the plaintiff could work twenty hours per week.

64 Her Honour then referred ([79]-[84] of her reasons) to the statutory test relating to loss of earning capacity, set out in s 134AB(38)(e) and (f). She noted ([85]) that the plaintiff's current earnings from personal exertion are nil. Her Honour stated:

[86] Even if I were to accept that the plaintiff could work twenty hours per week, the plaintiff satisfies the arithmetical formula established by the Act.

65 Accordingly, her Honour held ([88]) that she was satisfied that the respondent had established the requirement set out in s 134AB(38)(f). Her Honour was satisfied that the plaintiff has no prospect of re-training and re-education which would enhance his earning capacity. Thus she concluded that the respondent had satisfied the requirements of s 134AB(38)(g) of the Act. On that basis, her Honour held ([90]) that the respondent's application seeking leave to bring proceedings for damages for pain and suffering and loss of earning capacity were successful.

66 At the commencement of oral argument on the appeal, senior counsel for the appellant accepted that, as the respondent had commenced his proceeding in the County Court after the repeal of s 134AD of the Act on 10 December 2009, s 134AD has no application to this case. I consider that that concession is correct.[1] It follows that the test which is to be applied, on this appeal, was that stated by the court in Mobilio v Balliotis[2] namely, that the judges' determination that a plaintiff had, or had not, suffered a serious injury, should be set aside only 'for specific error or if it was plainly wrong or wholly erroneous'.

67 The notice of appeal (as further amended on the hearing of the appeal) contained twenty five grounds of appeal. Not all of those grounds were addressed by the appellant. In its written outline, and in oral submissions, the appellant raised five principal issues. The arguments on both sides were directed to those issues, rather than to the specific grounds of appeal. It is convenient to adopt the same approach, albeit that I shall endeavour to relate the issues raised by the appellant to the specific grounds of appeal.

68 In substance, the five principal bases, upon which the appellant sought to overturn the decision of the trial judge, were as follows:

(1) The judge granted leave to commence common law proceedings without having first found that the respondent had suffered a 'serious injury' under s 134AB(37) of the Act.

(2) The judge failed to give adequate reasons for her decision to grant leave to the respondent to issue common law proceedings.

(3) The judge erred in finding that the respondent was a credible witness. In particular -

(a) the judge's finding was unsustainable in the face of the video surveillance evidence and in light of the failure of the respondent to reveal (before he was cross-examined) his activities in hiring boats on Nagambie Lake.

(b) the judge failed to give adequate reasons for finding that the respondent was a credible witness, notwithstanding the matters referred to in (a).

(4) The judge erred (in a number of respects) in making findings in respect of the respondent's loss of earning capacity.

(5) The judge erred in, on the one hand, giving significance to the fact that the appellant only relied on two hours of the film tendered in evidence, and, on the other hand, failing to give any significance to the failure of the plaintiff to call four particular witnesses who (it is alleged) were available to the respondent.

No finding of serious injury (Grounds 1, 2, 6, 7)

69 The first basis, upon which the appellant submitted that the trial judge erred, was that her Honour granted leave to commence common law proceedings without having first found that the respondent had suffered a 'serious injury' under s 134AB(37) of the Act. That proposition is reflected in grounds 1, 2, 6 and 7 of the further amended notice of appeal.

70 In support of those grounds, senior counsel for the appellant submitted that, under the statutory scheme contained in s 134AB(37), the judge was first required to identify the injury or injuries which the respondent claimed constituted a serious injury or serious injuries. Secondly, her Honour was required to determine whether each such injury constituted a 'serious injury'. In particular, the judge was required to determine whether each elbow injury constituted a permanent serious impairment of the particular body function, as defined in s 134AB(38)(c). Similarly, the judge was required to determine whether the psychological injury, relied on by the respondent, constituted a 'permanent severe mental ... disturbance' in terms of its consequence to the respondent, as required by s 134AB(38)(d). Senior counsel for the appellant submitted that the trial judge had failed to make any analysis of the particular consequence, or impairment, to the respondent resulting from the particular injury, which the respondent sought to establish was a 'serious injury'. In that way, he submitted that the trial judge granted leave to commence the common law proceedings without having first found that the respondent had suffered a 'serious injury' under s 134AB(37).

71 Further, senior counsel submitted that, in granting leave, the trial judge impermissibly aggregated, or combined, the effects of the three injuries claimed by the respondent. Counsel referred to the decision of this Court in Lu v Mediterranean Shoes Pty Ltd,[3] in which the Court held that it was impermissible to aggregate two or more separate injuries in order to determine whether an applicant had established the requisite 'serious injury' for the purposes of obtaining leave under the equivalent to s 134AB of the Act.

72 In response, senior counsel for the respondent submitted that the reasons for judgment of the trial judge must be considered in the context of the issues which were at large at the trial. He submitted that there was no issue at the trial that, if the trial judge accepted the medical evidence relied on by the respondent, each of the elbow injuries, and the psychiatric injury, satisfied the requisite test of serious injury. He submitted that the principal, if only, issue at trial concerned the credit of the respondent in describing his disability and limitations to the medical practitioners and to the Court. Senior counsel submitted that, in the absence of an adverse finding by the trial judge as to the respondent's credit, there was sufficient evidence, in the medical reports, to support a finding by the trial judge that each of the three injuries, sustained by the respondent, constituted a serious injury.

73 Senior counsel for the respondent pointed out that, at the commencement of her reasons, the trial judge set out, in detail, an accurate resume of the statutory regime which applied to the application by the respondent for leave to institute common law proceedings in respect of each of his injuries. Her Honour was thus conscious of the requirements of s 134AB. In that context, counsel submitted that, read in light of the issues which were agitated at trial, the trial judge concluded that each of the three injuries, complained of by the respondent, constituted a serious injury.

74 In order to put the appellant's submissions in context, it is necessary to set out the scheme of s 134AB. The effect of s 134AB(16)(b) and (19)(a), in the present case, was that, in order to be granted leave to commence common law proceedings, the respondent was required to prove that he had suffered a 'serious injury'. That term is defined in sub-s (37) to mean (inter alia) a 'permanent serious impairment or loss of body function'[4] or a 'permanent severe mental or permanent severe behavioural disturbance or disorder'.[5] Subsection (38)(b) provides that the terms 'serious' and 'severe' are to be satisfied by reference to the consequences to the worker of an impairment with respect to (i) pain and suffering; or (ii) loss of earning capacity. Section 134AB(38)(c) and (d) define the terms 'serious impairment' and 'severe disorder'. Section 134AB(38)(e) provides that a court shall not grant leave on the basis that the worker has established the relevant loss of earning capacity unless the worker establishes 'in addition to the requirements of sub-paras (c) or (d)' a permanent loss of earning capacity of 40 percent. Where the worker establishes such a loss, the worker is entitled to institute common law proceedings for both pain and suffering and loss of earning capacity damages.[6]

75 For the purposes of determining this part of the appeal, the following propositions apply in relation to the provisions to which I have referred:

(1) In determining a serious injury application, the trial judge must first identify the injury, or injuries, which is or are claimed by the applicant to be a serious injury or serious injuries.[7]

(2) The judge must then assess, in respect of each particular injury alleged by the applicant, whether the impairment consequent upon the injury is 'serious' (if the injury constitutes an impairment or loss of a body function) or, if the injury alleged by the applicant is a mental or behaviour disturbance or disorder, whether that disorder is 'severe'.

(3) In performing that task, the trial judge must carry out the assessment of the degree of impairment in respect of each injury, complained of, separately. The judge must not aggregate two or more impairments, from different injuries, in order to determine whether the injury is serious, unless the injuries arose out of the same incident.[8]

(4) Pursuant to s 134AB(17), if an applicant establishes a serious injury with respect to pain and suffering, but not with respect to loss of earning capacity, the applicant may only bring proceedings for the recovery of damages for pain and suffering.

(5) In order to grant leave to an applicant to bring proceedings for the recovery of damages for loss of earning capacity, the trial judge must determine, first, whether the impairment resulting from the injury is serious (if a loss of body function) or severe (if the injury is a mental or behavioural disturbance or disorder), and, secondly, whether the applicant has established a permanent loss of earning capacity in accordance with the formula specified in s 134AB(38)(f).

(6) If the applicant establishes that the injury is a serious injury, and also establishes the requisite permanent loss of earning capacity of 40 percent, the applicant is entitled to bring a claim for damages for both loss of earning capacity, and also for pain and suffering damages.[9]

76 The question, then, is whether the trial judge did identify the injuries, that were claimed to be serious, and then carried out the requisite assessment, in respect of each injury separately, whether the impairment consequent upon any bodily injury claimed was serious or whether the claimed psychological disturbance was severe.

77 After considering issues relating to the credibility of the respondent, the trial judge ([68]) stated that she was satisfied the respondent had suffered a compensable injury arising out of, or in the course of, his employment with the defendant, in respect of the injury to the left and right arm and the psychological behavioural disturbance. In that way, the trial judge, did, sufficiently, identify each of the injuries claimed by the respondent to constitute a serious injury.

78 However, the trial judge's reasons do not contain any assessment whether, or finding that, the impairment consequent, upon each elbow injury, was a serious impairment, as defined in s 134AB(38)(c). Nor do her Honour's reasons contain any assessment whether, or finding that, the psychological disturbance, complained of by the respondent, constituted a 'severe' permanent mental disturbance as defined in s 138AB(38)(d). Having found that each of the three injuries complained of by the respondent were compensable, her Honour ([69]) stated that she would be influenced more by the up to date medical reports. The practitioners, whose reports her Honour nominated, were relevant (in the case of Mr Grossbard, Associate Professor Wallin and Mr Dooley) to an assessment of the respondent's elbow injuries, and (in the case of Dr Payne, Dr Epstein and Dr Shan) to an assessment of the respondent's psychological condition.

79 The trial judge then rejected the submission by the appellant that she could not rely on the information the respondent had given to the medical practitioners ([71]). Her Honour then referred ([72]-[77]) to the evidence as to the respondent's psychological condition. In particular, her Honour referred to the evidence given by Dr Kosky, Dr Epstein, Dr Payne and Dr Shan as to the respondent's present and future employment capacity. In that context, her Honour accepted that the position, which he has as a caretaker at Nagambie Lakes, could not be equated to 'real work' employment. Having made that observation, her Honour then moved to consider the provisions of s 134AB(38)(e) and (f) which the respondent must establish to obtain leave in respect of the loss of earning capacity.

80 Pausing there, it may be inferred that the trial judge, at that stage, was satisfied that the respondent had suffered at least one serious injury. At that point, the trial judge had concentrated on the respondent's psychological condition. However, it could not be inferred, from her Honour's reasons, that she had rejected either elbow injury as constituting a 'serious injury'. Her Honour's reference ([68] of her reasons) to all three injuries as compensable injuries, and ([69]) to the reports of Messrs Grossbard, Wallin and Dooley, would preclude any such inference. Rather, it is sufficiently clear that her Honour considered, collectively, the effect of the respondent's injuries, particularly when determining whether his claim for a loss of earning capacity satisfied s 134AB(38)(e) and (f). Thus, [89] her Honour accepted that the respondent had satisfied the requirements of s 134AB(38)(g), and her Honour therefore concluded that the respondent's application 'seeking leave to bring proceedings for damages for pain and suffering and loss of earning capacity is successful'.

81 In my view, that analysis of the reasons of her Honour produces the following conclusions. First, there was no finding, recorded by the trial judge, that any or each of the three injuries, complained of by the respondent, was or were a serious injury or serious injuries. Secondly, insofar as any such finding by her Honour is implicit, her Honour provided no reasons for reaching such a conclusion. Thirdly, at least at the stage at which the trial judge considered whether the respondent had satisfied the test set out in s 134AB(38)(e) and (f) in order to claim loss of earning capacity, the trial judge aggregated the three injuries, in order to determine the respondent's current and future earning capacity.

82 Thus, on their face, the trial judge's reasons failed to contain the findings necessary to found a conclusion, in respect of each of the three injuries complained of by the respondent, that that injury constituted a serious injury as specified in s 134AB(37) and (38). To the extent to which any such findings may be implied from the trial judge's reasons, her Honour did not furnish any reasons or explanation for making such a finding.

83 The question, as to the sufficiency of the trial judge's findings, is not determined solely from the text of the reasons for judgment. A judge's reasons, particularly on a serious injury application, must be considered in light of the issues which were agitated at the trial. There is force in the point, made by senior counsel for the respondent, that at trial the appellant barely, if at all, made any submission to the effect that, if the trial judge accepted the truthfulness of what the respondent had said to the medical practitioners, nevertheless the medical evidence was insufficient to establish that the respondent had suffered a serious injury. Rather, the thrust of the final address by junior counsel for the appellant was consistent with the manner in which the appellant had conducted the trial, namely, that the trial judge should not accept the evidence of the medical practitioners, because the histories given to them by the respondent was untruthful or inaccurate. In other words, the principal, if not sole, point made by the appellant, both during the trial and in final address, was that the factual basis, upon which the medical practitioners expressed their opinions, had not been established in the evidence.

84 On the other hand, at no stage during the serious injury application did the appellant concede that the injuries to each elbow, and the psychological injury, would each constitute a serious injury, if the evidence of the medical practitioners relied on by the respondent were accepted by the trial judge. At one stage in his final address, counsel for the respondent came close to conceding that, if the histories given by the respondent to the psychiatrist were truthful, the respondent's psychological condition might be characterised as a severe mental disturbance. However, when read as a whole, counsel did not concede that, in the event that the respondent's credibility were accepted, the judge should find that each of the three injuries, complained of by the respondent, was a serious injury. Indeed, and in particular, at one point in his final address counsel for the appellant referred to the range of activities, engaged in by the respondent, as depicted on the surveillance videos, and submitted that that course of activity was inconsistent with a person suffering a serious organic injury or a severe psychological injury.

85 In those circumstances, it remained necessary for the trial judge to find, in respect of each injury complained of, whether or not that injury constituted a serious injury, and to give some reasons for such a conclusion. I am not suggesting in this case that the trial judge overlooked such a requirement. Indeed, her Honour set out the relevant provisions of s 134AB at the commencement of her reasons. However, her omission to make the relevant finding in express terms, and to state reasons for it, is, I consider, fundamental. Under s 134AB(19)(a), the court is precluded from granting an applicant leave to commence common law proceedings, unless the court first finds that the applicant has suffered a serious injury. Such a finding is critical to the ultimate decision by a judge to grant, or refuse, leave to a plaintiff to commence common law proceedings. It may be that, in exceptional cases, the state of the medical evidence is such that a conclusion, that the injury or injuries complained of are a serious injury, is so obvious as to not require express statement. This case was not such a case. It was necessary for the judge to state the finding made by her Honour in respect of each injury, as to whether or not it constituted a serious injury as defined in s 134AB(37) and (38). Certainly, given the nature of the issues agitated in the case, her Honour was not required to provide extensive reasons for making that finding. Nevertheless, it was necessary for the trial judge to make the finding, in respect of each injury, and to give some reasons for doing so.

86 Further, it was necessary for the trial judge to consider, separately, the degree of impairment resulting to the respondent from each of the three injuries of which he complained. As I stated, I am satisfied that the trial judge, ultimately, aggregated the impairments consequent upon each of the three injuries complained of, particularly when her Honour considered whether the respondent had satisfied the tests for loss of earning capacity specified in s 134AB(38)(e) and (f).

87 It follows that in granting the respondent leave to bring proceedings for common law damages pursuant to s 134AB, the trial judge did err in failing to make findings that the respondent had suffered a serious injury or serious injuries. It follows that grounds 1, 2, 6 and 7 of the appeal are made out.

88 In reaching that conclusion, I should add that, in my view, the particular error, to which I have referred, was, to a substantial degree, a product of the manner in which the case was put before the trial judge by the parties. As I have observed, the defendant to the application (now the appellant) did not make any submission to the trial judge that, if her Honour accepted the credibility of the respondent, nevertheless the medical evidence, in respect of any of the three injuries complained of, was an insufficient basis for a finding of serious injury. Quite commonly, the fate of a serious injury application is heavily dictated by the assessment of the trial judge of a plaintiff's credit. Nevertheless, it is important that the defendant to such an application make it plain whether it accepts, or contests, the proposition that, if the plaintiff's credibility is accepted, the medical evidence is sufficient to justify a finding of serious injury. It should not be left to the judge to make an independent assessment of the medical evidence, unassisted by submissions by counsel, on the question whether they are, in any event, sufficient to justify a finding of serious injury.

Whether the trial judge erred in finding that the respondent was a credible witness: effect of the surveillance video evidence (Ground 24)

89 It is convenient to consider, next, the third principal issue raised by the appellant. The first part of that issue was a submission, which reflected Ground 24, that the trial judge erred in finding that the respondent was a credible witness. Ground 24 alleged that that finding was erroneous because it was against the evidence, and the weight of the evidence, and, in particular, the surveillance video evidence shown at trial. That submission addressed the issue which was central to the hearing before the trial judge, and to the matters raised on appeal.

90 As I have already indicated, the trial was conducted by the appellant principally upon the basis that the respondent had significantly exaggerated the nature and extent of his injuries and disabilities, when describing them to the medical practitioners, and also in his affidavit in support of his application. In particular, the appellant maintained that the video depicted the respondent engaging in activities, both physical and social, which contradicted the description which he had given to medical practitioners, and to the Court, of his disabilities and limitations. The video evidence was also relied on in support of the proposition that the respondent had not, before cross-examination, properly revealed the nature and extent of his involvement in the boat hire business at Lake Nagambie.

91 In support of that submission, senior counsel for the appellant noted that the respondent made no reference in his affidavit to the work, which he was performing in respect of the boats and canoes at Nagambie Lakes. Counsel referred to the description given by the respondent of his injuries and limitations to Professor Wallin on 1 October 2010, to Dr Kosky (as set out in Dr Kosky's report of 28 March 2011), to Dr Epstein on 20 July 2011, and to Dr Shan on 16 September 2010. Counsel submitted that the respondent had, in effect, portrayed himself, to each of those medical practitioners, as being severely restricted in his capacity to use his arms, and in his day to day activities. He had only made passing reference to his activities with the boat hire business. For example, he told Professor Wallin (in September 2010) that he engaged in a small amount of volunteer activities for the boat operator. Counsel also referred to the evidence given by the plaintiff under cross-examination at trial, before he was shown the video surveillance film. In that part of the cross-examination, the respondent referred to performing some other light activities such as mowing grass, doing some gardening, and assisting to put a boat out from time to time. Counsel submitted that the level of activity disclosed by the respondent, in that part of his evidence, was significantly less than the level of activity in which he was depicted, by the surveillance video, engaging in at the Nagambie Lakes.

92 Counsel then turned to the findings made by the trial judge in respect of the respondent's credibility, [64]-[67] of her Honour's reasons for judgment (which I have set out in paragraphs [61] and [62] above). It was submitted that the trial judge's observation, in [64] of her reasons, that '... the surveillance showed the plaintiff had a greater range of movement than he described', was a gross understatement of the difference between the level of activity depicted in the surveillance film and the description given by the respondent to the medical practitioners and in his evidence. Counsel also took issue with the description of the activities as being 'non-repetitive'. He contended that, contrary to the last sentence in paragraph 64 of the reasons, it was clear from the video surveillance film that the respondent was participating in the activities, depicted in that film, free of pain. He submitted that the trial judge erred in observing ([65] of her reasons) that the plaintiff was 'consistent' in reporting the injury and its causes to the doctors. He also took issue with the observation in [66] and [71] of her Honour's reasons, that the respondent had 'made concessions'; rather, he submitted that the activities conceded in cross-examination, before the respondent was shown the film, were far less substantial than those depicted in the film.

93 In support of his principal submission, counsel for the appellant also outlined what he described as five objective factors, which he submitted militated against the existence of any significant injury to the respondent's elbows. Those factors were: the video surveillance film; the full range of movement of the elbows elicited by Mr Scott and Mr Dooley and Mr Grossbard on examination; the lack of any observation by the medical practitioners of any wasting of the musculature of the respondent's arms; the fact that the ultrasound, conducted on the respondent's right elbow in 2005, showed little by way of abnormality; and the fact that the respondent had received little treatment for his injury to his elbows for a number of years before the hearing of the serious injury application.

94 Based on those matters, counsel submitted that the trial judge erred in concluding that the respondent was a credible witness in describing, in his evidence, and to the medical practitioners, the extent and nature of the pain and limitations suffered by him in relation to his elbow injuries, and in relation to his psychological state. It was submitted that the respondent was 'locked in' to the descriptions of his limitations given by him to a number of medical practitioners. He submitted that those descriptions, by the respondent, of his limitations, were irreconcilable with the range of movement and activity depicted by the surveillance video, regardless of what explanation the respondent gave in respect of them in cross-examination, and in what manner he gave such an explanation. In effect, counsel submitted that, based on the surveillance film, the conclusion by the trial judge that the respondent was credible in describing his limitations was necessarily erroneous.

95 In response, senior counsel for the respondent submitted that the findings by the trial judge, on the credibility of the respondent, should not be set aside as being erroneous, and they were neither glaringly improbable nor contrary to compelling inferences in the case. It was submitted that, as the trial judge had noted in her reasons for judgment, the surveillance video evidence only covered two hours of activity over a fourteen day period, and that it did not say anything about the respondent's psychiatric condition, or the pain which the respondent was suffering, while he was under observation. Counsel also placed weight on the observation made by her Honour that the activities, which the respondent was depicted performing, occurred in a rather leisurely environment, which should not be equated with 'real world' employment.

96 In order to consider the submission by the appellant, it is necessary to set out in some detail the contents of what is depicted on the video surveillance evidence which was put to the respondent in cross-examination and tendered on the application. For that purpose, the court took the opportunity to view the video surveillance evidence in chambers before the hearing of the appeal. The following is but a summary of the major aspects of matters which were observed on the surveillance video evidence.

97 Six segments of surveillance video were shown to the respondent of his activities on 16 January. Those segments depicted the respondent involved in a number of activities relating to the boat hire business. During those activities the respondent was not wearing a guard on either arm. The second segment depicted the respondent pushing a canoe along the ground, using his right hand, and conversing with a female customer in a canoe. The next segment depicted the respondent lifting a canoe off a trailer, and sliding it along the ground to the lake. It depicted him instructing a group of about three customers as to how to use the canoe, and how to push the paddle. The respondent also assisted the customers putting on their life jackets. In the next segment, the respondent is seen lifting a jerry can of fuel, and starting the motor of a boat using his right arm. He was also talking to a male. In the sixth segment of the film of 16 January, the respondent was seen talking with people, pushing another boat into the water with his right arm, moving the engine upright with his left arm, and starting the engine of the boat with his right arm. He then took off his singlet with his right arm. At another stage the respondent is seen talking to a young female customer and giving her a life jacket. He was gesturing freely with both arms, and holding the paddles to a canoe. At another stage he lifted the end of the canoe and slid it into the water, and gave a demonstration as to how to use the paddle.

98 Eight segments of surveillance video were shown to the respondent of his activities on 17 January 2011. During those activities the respondent was wearing a guard on his right arm. In the first segment, the respondent was in a boat with another male. He pointed his arm freely, and pulled the boat out of the water. The next segment showed the respondent starting an outboard motor on a boat. He had to pull the cord attached to the starter motor with seven vigorous tugs of his right arm in order to start the motor. The respondent was then depicted talking to a man, and drinking coffee holding it in his right arm. Next, the respondent pushed a boat which was on the bank, out into the water, and pulled it back in with the painter. He pulled another boat in the water, and then he coiled a rope around his right arm, flexing and extending his elbow quite freely while doing so. The next segment shows the plaintiff seated fishing in the lake. He is then depicted conversing with two children and two adults. In the next segment the respondent carried a deck chair in his left arm. In the final segment, he carried three or four life jackets held in his right arm, and two oars in his left arm; he opened the car door while he was still holding the life jackets in his right arm, and pulled more life jackets out of it with his right arm.

99 Seven segments of video were shown for 19 January. On that day the respondent was again wearing a guard on his right arm. In the first segment, he lifted and unloaded three canoes from a trailer, and he then pulled them along the ground towards the water. He then wiped the inside of one of the canoes with a rag, removed paddles out of a vehicle and placed them in the canoes, took a bag with life jackets to one of the canoes, removed the jackets out of the bag, helped fit the life jackets onto a number of young customers, and demonstrated to them how to use the paddle. The respondent was next depicted pulling a canoe up a steep bank with his right arm, while it had two adolescent passengers in it; he then pulled two further canoes up the same bank each of which contained two adolescents; he then took the life jackets from each of those six customers and carried them in his right arm. The next segment showed the respondent using a laptop computer. In the next segment, the respondent worked on the outboard motor of a boat while it was in the water, and at the same time conversed with a female; the respondent next got into a boat and steered it away. In the next segment, he lifted a fishing tackle box into the rear of his station wagon. In the final segment, he pulled three canoes from the bank of a lake to the trailer (which was about one canoe length away), lifted one end of each canoe onto the trailer and pushed that canoe onto the trailer.

100 Two segments of video were shown for 20 January. The first depicted the respondent conversing with people and dragging boats; the second showed him fishing, and in doing so he carried his fishing lines and a chair from his motor vehicle to the bank of the lake.

101 Six segments of video were shown for 21 January. On that day the respondent was again wearing a guard on his right arm. In the first segment, the respondent was smoking and talking to a male, and, while doing so, he gesticulated with his arms above his head. In the next segment, he talked to a different male. In the third segment, he unpacked life jackets and hung them to dry, and wiped the inside of canoes with a rag. In the next segment, he is seen briefly in a motor boat on the lake. The fifth segment seems to have been taken reasonably late in the day. The respondent is depicted lifting life jackets out of two boats, and pulling a boat while it was in the water. The sixth segment depicts the respondent sitting on a chair, with a colleague next to him, fishing in the lake.

102 Five segments of film were shown for 27 January. On that day, the respondent again wore a guard on his arm. In the first segment he was using a computer; he was then depicted opening a bottle and bending down, he then conversed with another man; the next segment shows him smiling; the final segment shows him talking on the telephone, while his computer was open.

103 Finally, eleven segments of video were shown for 28 January. On that day the respondent again wore a guard on his arm. In the first segment, he is seen driving a vehicle; he is then seeing conversing with children and removing life jackets from a car; in the third segment he carried a petrol container in his right arm, holding his right arm straight; the fourth segment depicts the respondent untying a boat and launching it, while there was at least one child in the boat; the next segment depicts the respondent pulling a canoe from a trailer, wiping out the floor of it, sliding it into the water, and then pulling it back with the rope; in the next segment the respondent carried a petrol container in his right arm, and after doing so he appeared to rub his right wrist; the respondent next is seen placing some small oars in a boat using his right arm; the respondent is then depicted starting the outboard motor of a boat using his right arm, and then pushing the boat from the shore using an oar; the respondent is next seen in a boat conversing with a person; he is then depicted washing out a boat by bucketing water from the lake into the boat, using both his right hand, and, on occasions, his left hand to assist; and in the final segment he is seen fishing using a rod and talking on the telephone.

104 Before departing from that summary, it is useful to make some general observations. First, in its totality, the video depicted the respondent carrying out a number of different tasks, which were related to the boat hiring business which he said he was assisting. In the video, the respondent appeared to be quite familiar with the task which he was carrying out, and he was able to perform them with a degree of confidence. Secondly, at no time did he evince any sign that he was suffering any physical pain to his arms, or otherwise, while carrying out any of the physical tasks which I have described. Indeed, he appeared to use his right arm in preference to his left arm, no doubt because he is right hand dominant. The respondent did not try to perform the tasks in a manner which would have imposed less strain on him, for example, by carrying fewer life jackets at one time. At no time, did he seem to be trying to protect either his right arm or his left arm. The respondent also appeared to be quite competent in the various tasks which he was performing.

105 In addition, the video depicts the respondent, on a number of occasions, interacting confidently and normally with a number of persons, who appear to be either customers or have some other relationship to the boat hire business. In one of the segments, he is seen having a long conversation with another male. It is evident that the work which the respondent performed in the business did require him to interact regularly with members of the public.

106 In light of those observations about the surveillance video, I now return to the principal submission made on appeal that the judge erred in finding that the respondent should be believed when he described, both in his evidence and to medical practitioners, the nature and extent of his disabilities and injuries. It was submitted that such a finding was erroneous, because it was contrary to the video evidence, and it was contrary to the fact that the respondent had not revealed to the medical practitioners, and to the court (prior to cross-examination), the extent of his activities in the boat hire business.

107 In considering the foregoing submissions, it is necessary to bear in mind the principles, which relate to the role of an appellate court in reviewing findings of fact, and, in particular findings, involving assessments of credibility, by a trial judge. Those principles were authoritatively stated in the joint judgment of Gleeson CJ, Gummow and Kirby JJ in Fox v Percy.[10] For present purposes, they may be summarised in the following propositions:

(1) The appellate court is obliged to give the judgment which, in its opinion, should have been given at first instance.

(2) On the other hand, the appellate court must bear in mind the natural limitations which exist in the case of any appeal on an issue of fact. In particular, the appellate court must take into account the natural advantages which the trial judge has in assessing the credibility of witnesses, and in evaluating the factual issues involved in the case over a longer period of time during the trial.

(3) Notwithstanding those limitations, the appellate court is obliged to conduct a real review of the trial.

(4) Where the decision, which is under appeal, is based on the credibility of witnesses, the appellate court should intervene where the conclusion reached at trial was 'glaringly improbable' or 'contrary to compelling inferences'.[11]

108 Based on those propositions, in order to sustain Ground 24, the appellant is required to demonstrate that the finding by the trial judge, as to the respondent's credibility, was 'glaringly improbable' or 'contrary to compelling inferences', bearing in mind the limitations of an appellate court reviewing a finding, which not only was based on the respondent's credibility, but which was, indeed, a finding as to his credibility.

109 On the face of it, the physical activities in which the respondent was engaged, as depicted on the surveillance video evidence, do raise a substantial question as to the credibility of the plaintiff's account, in his affidavit, and to medical practitioners, of the extent of the physical limitations imposed on him by his injuries to his left and right elbows. The activities in which he engaged, as depicted by the video, involved significantly greater use of the arms and elbows than would be expected in light of the limitations claimed by the respondent, in his affidavit, and to the medical practitioners. Those activities also involved a greater degree of social interaction by the respondent with customers and other persons at the Nagambie Lake, and a greater apparent ease of such interaction, than might be expected given the descriptions given by the respondent of his symptoms of depression.

110 As I stated, the respondent was cross-examined in detail as to the physical activities which are depicted in the video. He gave a number of responses to them. In some of those responses, the respondent pointed out that there were various factors involved in the actions performed by him, which would have obviated the degree of strain which otherwise would have been imposed on his elbows, and in particular on his right arm. For example, he pointed out that when he was lifting canoes, he tended to use his shoulder, and that he tended to lift more with his left arm than with his right arm. He stated that when he pulled the canoes over the ground, the bases of the canoes were often wet, which enabled them to slide along the ground more simply. The respondent also stated, in cross-examination, that while he suffered pain performing simple tasks (such as combing his hair), because he tended to perform them automatically, when he was performing tasks involving the application of greater force, he tended to prepare himself, so that he could perform those tasks in a manner which did not impose excessive strain on his injured elbows. In addition, the respondent pointed out that he performed some of his tasks with a great degree of pain, and that he was endeavouring to 'push through the pain barrier'.

111 In addition, a number of the answers given by the respondent in cross-examination are relevant to the question whether, in fact, there was any relevant discrepancy between the level of activity depicted on the video and the descriptions which the respondent had given to various medical practitioners of the degree of his disability. In cross-examination, the respondent did not accept the accuracy of a number of parts of the histories recorded by the medical practitioners in their reports. On other occasions, he only accepted part of the history recorded by a doctor as accurate, and added a qualification to the history which, he said, had not been recorded by the doctor. On other occasions, the respondent stated that the history, recorded by the medical practitioner, may have reflected the medical practitioner's misunderstanding or misperception of what he had said. On one occasion, in cross-examination, he stated that the limitations which were described by him to the medical practitioner (Professor Wallin) reflected how he was feeling at that time, which was different to how his elbows felt at the time of the video surveillance (January 2011).

112 In respect of this aspect of the cross-examination, and of the appeal, it is important to bear in mind the limitations which attend the reliance, by a court, on the records by medical practitioners, in their reports, of the histories and symptomatology described by plaintiffs to medical practitioners. Those histories are an important part of the information, upon which the medical practitioner forms a view as to matters such as the diagnosis and prognosis in relation to the plaintiff's injuries. However, rarely, do the histories, contained in medical reports, purport to be a verbatim record of what the plaintiff has said to the medical practitioner on examination. They are often, at best, an approximate paraphrase or précis of the account given by the plaintiff to the medical practitioner. Sometimes, the discrepancy, between the account recorded by the medical practitioner, and the evidence of the plaintiff, cannot be adequately explained, even taking into account the limitations which attend the recording by a medical practitioner of the history given to the practitioner by the plaintiff. Nevertheless, it is important to bear in mind the nature and purpose of the history, recorded by medical practitioners in their reports, and of the limitations on their accuracy which I have just described.[12]

113 Taken together, the responses given by the respondent in cross-examination in relation to the activities depicted on the video do, to a reasonable extent, explain the discrepancies and apparent inconsistencies between the activities depicted on the videos, and the physical limitations claimed by the respondent, both in his affidavit, and to the medical practitioners. It may be possible to analyse and assess the validity of some of those responses by reference to the transcript. However, an integral component of the assessment of those responses, and thus an important aspect of determining whether they do explain the discrepancies which would otherwise undermine the respondent's credibility, consists of the manner in which the respondent himself gave those responses under cross-examination from counsel.

114 In this respect, it is important not to underestimate the importance, in assessing credibility, of the advantage which the trial judge has in observing, at close quarters, the respondent under cross-examination of the type undertaken by counsel in this case. The transcript does not reveal matters such as the respondent's demeanour, his tone of voice, and his manner of speech. Nor does the transcript record whether the witness spoke spontaneously, or whether he was hesitant in his speech. The bare reading of the transcript does not always adequately reveal the intellectual capabilities of the witness, or whether the witness is, by nature, articulate. The trial judge also has advantage of forming some view as to the personality of the witness. Thus the trial judge is able to assess whether the witness is naturally reserved, or, on the other hand, particularly self-confident by nature. Those, and other matters, are all part and parcel of the assessment by a trial judge of responses by a witness under cross-examination, of the kind on which the determination of this ground of appeal depends in large measure.

115 In that context, the trial judge had the advantage of observing the respondent, under cross-examination, over a period of three days. Her Honour was, necessarily, in a much superior position, than a court of appeal, to assess, during that period, the credibility of the responses given by the respondent, under cross-examination, in respect of the limitations and disabilities claimed by him, and in respect of the activities performed by him as depicted on the surveillance video. The trial judge was in a particularly advantageous position in viewing, at first hand, the respondent while he was under cross-examination in relation to the contents of the surveillance video, and how he gave his responses to cross-examination as to particular aspects of the video evidence.

116 In CSR Ltd v Della Maddalena,[13] the plaintiff, whose claim failed at first instance, had been cross-examined at trial in respect of video surveillance tapes which were shown to him. The Full Court of the Supreme Court of Western Australia found that the primary judge had erroneously resolved a number of factual issues, including the proper inference to be drawn from the surveillance tapes. The defendant's appeal to the High Court succeeded by majority. In their joint judgment, Callinan and Heydon JJ emphasised the advantages enjoyed by a trial judge in assessing the responses of a plaintiff under cross-examination in respect of surveillance video footage. Their Honours noted that the members of the Full Court had viewed the video recordings. They then stated:

[179] ... That opportunity (to observe the video footage) was a substantial one, but it still fell far short of the real advantage that the trial judge enjoyed in this case, of actually seeing and hearing the evidence of the witnesses, particularly the respondent, and to observing his reaction to each segment of the film as it was shown to him.

[180] There are cases in which the advantages enjoyed by trial judges over appellate courts are exaggerated. A complete written record, a degree of detachment from the trial itself, and the sum of the collective knowledge and experience of three or more judges may themselves on occasions place the appeal court in a superior position to that of the trial judge to decide the case. But this is not such a case. This is one in which the 'subtle influence of demeanour' cannot be overlooked ... The trial judge formed a certain impression of the respondent judged in relation to the video recordings and his reaction to them. The way in which the respondent visibly responded to questions, any delays, evasions or reluctance in answering them, and the extent of his fluency in English, were all matters of especial relevance in a case of this kind, and ones which only the trial judge, and not a court of appeal could perceive and weigh against all of the other relevant evidence in the case. They bore directly upon the weight to be given to the respondent's evidence at the trial, his statements to the medical practitioners, and their opinions of them. ... In consequence, this was not a case in which a different opinion (by the appellate court) from the trial judges, of what the video film showed, judged in relation to testimony, particularly from the respondent, about it could justify the reversal of a finding of credibility adverse to a party.[14]

117 In my view, those observations, by their Honours, apply with particular force to this case. The question, whether the respondent's answers in cross-examination provided a sufficient explanation of the apparent discrepancy between what is depicted on the video and the respondent's previous claimed limitations, depend, not only on the content of the responses, but also on the manner in which the respondent gave those responses in court. Having had the opportunity to view the video footages which were shown in cross-examination, and to read the transcript, I could not, without observing the respondent under cross-examination, form the view that the trial judge should have reached no other conclusion than to reject the explanations given by the respondent in cross-examination. The determination of that issue is intimately and inextricably connected to an evaluation, not only of the content of the responses, but also of the manner in which the respondent gave them, in the atmosphere of the trial under cross-examination by experienced and skilled senior counsel.

118 The same observations apply to the respondent's answers to the proposition put to him, in cross-examination, that he had not hitherto revealed, either in his affidavit, or to medical practitioners, the nature and scope of the activities undertaken by him in the boat hire business. When questioned on that aspect of the case, the respondent denied that he had concealed from the doctors the nature and level of his activities with the boats. In relation to questions as to what he stated to particular medical practitioners, or vocational assessors, he did not, at all times, concede that he had not told them about his activity in the boat hire business. For example, he suggested that the vocational assessor, Ms Bryant, may have misunderstood what he had told her in that respect. On other occasions, he contested the account of the interview given by a medical practitioner in the medical report. For example, when it was put to him that in March 2011 he told Dr Shan that he had not worked, the respondent stated that Dr Shan did not ask him anything at all about that topic.

119 In this respect, again, the question whether the respondent's answers in cross-examination should be accepted depends, to a substantial degree, on the manner in which the respondent gave his answers under cross-examination. It is not possible to form a proper view, as to whether the respondent's explanation should be accepted, from the face of the transcript. Unless the respondent's explanations are rejected, the appellant would fail to sustain one of the premises upon which it bases it argument on appeal, namely, that the respondent consistently concealed from medical practitioners, the nature and extent of the work which he was performing at the boat hire business.

120 In those circumstances, without having the opportunity to view the respondent under cross-examination, I could not conclude that the finding by the trial judge, that the respondent was a credible witness as to nature and extent of his disabilities, was so 'glaringly improbable' or 'contrary to compelling inferences' that it should be set aside on appeal. I would therefore reject ground 24 of the further amended grounds of appeal.

The adequacy of the trial judge's reasons for finding the respondent to be a credible witness (Ground 25)

121 The alternative submission by senior counsel for the appellant was that the trial judge failed to give adequate reasons in respect of her finding that the respondent was a credible witness, in light of the contrast between the respondent's activities depicted in the video surveillance evidence, and the respondent's description of his level of activity in his affidavit evidence and in medical histories given to medical practitioners between 2010 and 2011. That alternative submission reflects ground 25 of the further amended notice of appeal.

122 In support of that submission, senior counsel adopted the criticisms, which he had made of [64]-[67], and [71], of the trial judge's reasons, and which I have set out earlier. In addition, he submitted that the trial judge failed to make any adequate comparison between, on the one hand, the description given by the respondent of his limitations in his affidavit and to medical practitioners, and, on the other hand, the activities in which the respondent is depicted engaging in the surveillance video. Senior counsel submitted that the trial judge failed to give adequate reasons as to why the discrepancies between the respondent's evidence and descriptions to medical practitioners, on the one hand, and the surveillance film on the other, did not fatally undermine the respondent's credibility in relation to his claimed limitations and disabilities. Senior counsel further submitted that the trial judge failed to deal, at all, with the discrepancy between, on the one hand, the limited disclosure by the respondent, in his affidavit and to medical practitioners, of his activities in relation to the boat hire business at Lake Nagambie, and, on the other hand, the range of tasks performed by the respondent in respect of that business, as depicted on the surveillance video evidence.

123 In response, senior counsel for the appellant submitted that the trial judge adequately set out, [68]-[78] of her reasons, why her Honour rejected the submissions made by the appellant in relation to the credibility of the respondent. He submitted that her Honour's reasons, in that respect, are as extensive and complete as the Court should be expected to give on the trial of an action. It was submitted that the fact that the appellant may disagree with the conclusions drawn by her Honour does not mean that she failed to give adequate reasons.

124 The obligation of a trial judge to give sufficient reasons for decision is a fundamental requirement. The failure to provide adequate reasons is an error of law.[15] Such an obligation is also expressly specified in s 134AE of the Act. There are two basic purposes to be served by such reasons. First, the provision of adequate reason enables a Court of Appeal to ascertain the basis upon which the decision, the subject of the appeal, was made.[16] Secondly, a failure by a judge to provide adequate reasons can engender a real sense of grievance on the part of a losing party, who is left in ignorance as to why the decision, adverse to its interest, has been made. Allied to that purpose is the public interest in maintaining public acceptance of judicial decisions and the integrity of the court process.[17]

125 In order to vindicate both purposes, the reasons must disclose the 'path' or 'route' by which the trial judge reached the ultimate conclusion in the judgment.[18]

126 In Hunter v Transport Accident Commission & Anor,[19] Nettle JA, in an application under s 93(4)(d) of the Transport Accident Act 1986, identified the fundamental requirements necessary for the provision of adequate reasons in the following terms:

Furthermore, while the extent of the reasons will depend upon the circumstances of the case, the reasons should deal with the substantial points which have been raised; include findings on material questions of fact; refer to the evidence or other material upon which those findings are based; and provide an intelligible explanation of the process of reasoning that has led the judge from the evidence to the findings and from the findings to the ultimate conclusion. It should also be understood that the requirement to refer to the evidence is not limited to the evidence that has been accepted and acted upon. If a party has relied on evidence or material which the judge has rejected, the judge should refer to that evidence or material and, in giving reasons which deal with the substantial points that have been raised, explain why that evidence or material has been rejected. There may be exceptions. But, ordinarily, where a judge rejects or excludes from consideration evidence or other material which is relevant and cogent, it is simply not possible to give fair and sensible reasons for the decision without adverting to and assigning reasons for the rejection or exclusion of that material. Similarly, while it is not incumbent upon the judge to deal with every argument and issue that might arise in the course of a case, where an argument is substantial or an issue is significant, it is necessary to refer to and to assign reasons for the rejection of the argument or the resolution of the issue.

127 On the other hand, in determining the adequacy of reasons in an application under s 134AB of the Accident Compensation Act, it is important to bear in mind both the nature of the proceeding, and the manner in which materials are put before the court. In respect of the latter matter, the application is brought by originating motion. The plaintiff's evidence in chief is not led viva voce, but, rather, is contained in an affidavit. Ordinarily, the only supplementation of such evidence is by way of short oral evidence, bringing the plaintiff's situation up to date. The plaintiff is then cross-examined, sometimes at some length. Most, if not all, of the medical evidence, is put before the court by the tendering of the reports of various medical practitioners, who have treated or examined the plaintiff. While it is not uncommon for some of the doctors to be cross-examined, ordinarily the large majority of the medical practitioners, whose evidence is put before the court, are not cross-examined. Other material - including rehabilitation reports - are also usually tendered. At the end of the day, the trial judge is thus left with a large mass of material, some of which, frequently, is quite irreconcilable.[20]

128 The procedure, which I have just described, is, in large measure, a reflection of the fact that a serious injury application is preliminary in nature, albeit that an adverse finding against a plaintiff is, in effect, conclusive of the plaintiff's rights. The preliminary nature of the proceeding generally has the effect that the hearing of a serious injury application is not conducted in the same manner as the trial of a common law claim for damages.

129 In addition to that, the assessment made by the judge is, ultimately, in the form of a value judgment. In Nichols & Anor v Robinson,[21] Winneke P described the nature of the task carried out by the trial judge in terms which were adopted in a number of subsequent decisions. There the learned President stated:

... An assessment by the trial judge as to whether an injury is 'serious' when measured against the criteria of guidance laid down in the well known authorities is a task which is carried out by County Court judges day after day. It is a task which necessarily involves them in making a value judgment as to whether the injury which they are considering is, by comparison with other cases in the range of possible impairments or losses, to be described as 'very considerable'. Like an assessment of non-pecuniary loss in a personal injury case, it is not a value judgment which needs now to be attended by statements of principle, nor does it readily admit of explicit reasoning. Nor, in my view, is it a task where the judge is required to arrive at any firm conclusion as to the extent or degree of pecuniary disadvantage which is accrued to the person injured, as was contended before us. ... It must be remembered that the task which the judge is asked to perform is one which is a prelude to a claim being brought by the plaintiff against a putative defendant. The material which he has before him is necessarily limited ...[22]

130 In a number of subsequent decisions, the courts have reiterated the point made by Winneke P, namely, that a serious injury application necessarily involves a substantial amount of 'value judgment' which does not itself admit of detailed explicit reasoning.[23] In Kelso v Tatiara Meat Co Pty Ltd,[24] Dodds-Streeton JA, having considered Nichols v Robinson and Hunter v Transport Accident Commission, stated:

As Nettle JA emphasised in Hunter, completeness entails inclusion of all the material findings of fact and the significant arguments or issues and some explanation for the judge's preference in a conflict of evidence, or for his or her rejection of evidence. There is, however, no inconsistency between those requirements and Winneke P's recognition that s 134AB(16(b) applications involve, in large part, matters of value judgment, opinion or impression in which the reasons for judgment may properly be relatively brief and non-exhaustive, without voluminous discussion of authorities, or lengthy expositions of well understood criteria. Winneke P's observation did not, contrary to the terms of s 134AE, authorise 'summary reasons' of a different character or standard from those required for a trial, but simply noted the element of summary process in a leave application pursuant to s 93(4) of the Transport Accident Act.

131 The adequacy of the reasons must depend upon the issues, and nature of the proceeding, in any individual case. In an appropriate case, reasons can be adequate by a combination of what is expressly stated and the inferences that necessarily arise from what is expressly stated.[25] Thus, as Neave JA and Beach AJA stated in Murray Goulburn Coop Co Ltd v Filliponi[26]:

In some cases, the path of reasoning which led to the ultimate conclusion is necessarily implicit in a sufficiently detailed recitation of the relevant material upon the decision was based.

132 In determining whether in this case the reasons of the trial judge were adequate, it is important to bear in mind that the central feature in the trial concerned the credibility of the respondent in describing his disabilities, in his affidavit, and to medical practitioners. That issue was foreshadowed, in plain terms, by senior counsel at the conclusion of the opening of the case made by senior counsel for the plaintiff. At that stage, senior counsel informed the trial judge that he would 'attack the credibility of the plaintiff' and that the ultimate submission on behalf of the appellant was that the respondent had 'feigned the disability'. Senior counsel was true to his word. In his cross-examination, he put to the respondent, on a number of occasions, that he had deceived the medical practitioners concerning the extent of his disability, and that he had deliberately concealed the extent of the activities, in which he was involved in relation to the boat hire business at Lake Nagambie. The attack by the appellant on the respondent's credibility was continued in final address by junior counsel, although in more muted terms. At the commencement of the trial judge's reasons, her Honour noted that counsel for the appellant had informed her that the case was one in which the credit of the respondent would be attacked to the extent that the respondent had feigned his disability, and that his evidence was thus affected.

133 Allied to that, is the fact that the central aspect of the attack on the respondent's credibility, throughout the serious injury application, consisted of the evidence contained on the surveillance video tendered to the court. That footage was shown to the respondent, while he was under cross-examination, at five different stages of his cross-examination. He was cross-examined, in some detail, as to his activities and actions depicted on that footage. The cross-examination of the respondent on that matter was vigorous and thorough. In final address, junior counsel for the appellant, again, relied heavily on the alleged discrepancies between, on the one hand, what was depicted on the video, and, on the other hand, the level of disability claimed by the appellant, both in his affidavit, and in the histories which he gave to medical practitioners.

134 In those circumstances, therefore, it was necessary for the trial judge to address adequately the apparent discrepancies between the previous accounts given by the respondent, and the level of activity depicted on the surveillance video. As I have already stated, on the face of it, the physical activities in which the respondent was engaged, as depicted on the video footage, raised a substantial question as to the credibility of the account given by the plaintiff, in his affidavit, and to medical practitioners, of the nature and extent of his physical and psychological limitations. The video footage, which I have summarised, not only displayed the respondent having an apparent full and pain free use of his arms, but also engaging in a wide range of activities in respect of the boat hire business. In those circumstances, I consider that the trial judge was required to address the apparent discrepancies between the video footage, and the respondent's claims to disability, and to explain why, notwithstanding those discrepancies, her Honour concluded that the respondent was a credible witness in relation to the nature and extent of his disabilities.

135 The trial judge principally addressed the issues raised by the surveillance video in paragraph 64 of her reasons, namely, the range of physical movements depicted on the video. However, neither that paragraph, nor the succeeding paragraphs, of her Honour's reasons, deal adequately with the matters to which I have referred. The description of the video, as a 'snapshot in time', underestimates the impact of the video. In fact it records a series of activities, undertaken by the respondent, over a six day period in January 2011. Further, while the respondent did say that on some days he was able to do more activities than on other days, he did not, in cross-examination, state that the video depicted him on one of his 'better days'. In addition, the statement, that the surveillance showed that the respondent had a 'greater range of movement than he described', is a substantial understatement. While (as noted by the trial judge) the activities performed by the plaintiff were not of the repetitive nature performed in industrial premises, nevertheless he did perform the same activities (for example lifting and moving canoes) on repeated occasions. At no time, in performing all of the activities depicted on the video, did he evince any sign that he was suffering any pain or discomfort in his elbows or arms. Thus, the explanation given by the trial judge, that the video did not say anything about the pain suffered by the plaintiff, was not, by itself, an adequate basis for discounting the effect of the video surveillance evidence.

136 As I stated, the respondent, when cross-examined about the video, gave a number of responses, in which he sought to explain the apparent discrepancies between what was depicted on the video, and the descriptions of his disabilities which he gave in his affidavit and to medical practitioners. Those responses, by the respondent, were an important part of the evidence in the trial. The trial judge, in her reasons for judgment, did not make any assessment as to whether she accepted the answers, and whether, if they were accepted, they sufficiently accounted for the apparent discrepancies to which I have just referred.

137 In addition, the reasons given by the trial judge did not address the proposition advanced by the appellant, both in cross-examination and in final address, that the respondent had not been forthcoming about the level of activity in which he engaged in respect of the boat hire business. As I stated, the video depicts the respondent engaging in a variety of activities in the management by him of the boat hire business. In cross-examination, after being shown the film, he accepted that he was managing the business in the absence of its owner. The trial judge in her reasons did not address, in express terms, the issue whether the respondent had hitherto deliberately concealed his level of involvement in the boat hire industry, both in his affidavit, and when giving histories to the medical practitioners. That issue was a prominent part of the cross-examination of the plaintiff and of the appellant's final address. The trial judge, in her reasons, did not consider the discrepancy between the level of involvement of the appellant in the boat hire business, depicted in the surveillance video, and the description of that involvement, recorded by the medical practitioners who had examined the respondent. In particular, the trial judge did not, in her reasons, address the answers given by the appellant in cross-examination on that matter, and the explanations given by the appellant for the apparent discrepancy in respect of it.

138 As I have already stated, the respondent was cross-examined in some detail as to the apparent differences between the level of involvement in the boat hire industry depicted in the video, and the histories recorded by some of the medical practitioners. I have already summarised some of the responses made by the respondent to that line of cross-examination. In my view, it was necessary for the trial judge to give some consideration to the responses given by the respondent in cross-examination. Her Honour should have indicated whether she accepted those responses, and whether they do account for the apparent difference between the involvement of the respondent in the boat hire business, as depicted by the video, and the histories recorded by the medical practitioners in question.

139 I accept that, generally, an assessment of the credibility of a witness is largely a matter of value judgment and impression. Such an assessment does not, readily, admit of lengthy exposition in reasons for judgment. However, in this case, a large part of the trial was occupied by the attack on the respondent's credit, by reference to the video footage. The two major points made by the appellant, on a number of occasions, were that the respondent had exaggerated his disabilities when describing them in his affidavit and to medical practitioners, and that he had deliberately concealed the extent of his involvement in the boat hire business at Lake Nagambie. In order to provide adequate reasons, the trial judge was required to address the activities and actions depicted on the video, and to address the question whether those activities and actions undermined the credibility of the respondent in the manner contended by the appellant. It was necessary for the trial judge to analyse the answers given by the respondent in cross-examination, and to indicate whether she accepted those answers, and whether they accounted for the apparent discrepancies between the video surveillance film and the previous accounts given by the respondent as to his limitations and to his activities.

140 Unfortunately, the reasons of the trial judge do not fulfil those requirements. In particular, the parts of her Honour's reasons, to which I have referred, do not address the matters to which I have referred. It follows that, in my view, the reasons given by the trial judge for her acceptance of the respondent's credibility were not adequate.

141 In reaching that conclusion, I should emphasise that the observations which I have made, concerning the matters which were required to be addressed by the trial judge, are particular to the circumstances and facts of this case. I am conscious of the burden on County Court judges, day after day, in hearing and determining serious injury applications. What I have written does not require, in each case in which video surveillance footage is shown, the extent of analysis which, I consider, was required in this case. However, this case, in some respects, was somewhat unusual. The amount of the video footage, and the varying types of activities depicted on them, was substantially greater than that normally available in a common law trial. Further, the cross-examination, and indeed the final address by counsel, on the video footage occupied a substantially greater proportion of the hearing time of the case than that which is ordinarily so. It was those matters which required the kind of analysis, in the reasons for judgment, to which I have just referred.

142 For those reasons, I am persuaded that the trial judge did fail to give adequate reasons for her conclusion that the respondent was a credible witness in light of the apparent contrast between the respondent's activities as shown on the video surveillance evidence and the account given by the respondent of his level of activity in his affidavit and in the histories which he gave to medical practitioners. Accordingly, ground 25 of the further amended notice of appeal is made out.

Failure of the respondent to call witnesses: the Jones v Dunkel point (grounds of appeal 22, 23)

143 It is appropriate to deal next with the submission by the appellant concerning the failure of the respondent to call particular witnesses, because that submission, in the upshot, reflects on what I have just said about the adequacy of the trial judge's reasons.

144 The appellant submitted that the trial judge erred in failing to draw an inference adverse to the respondent in relation to his failure to call four witnesses to corroborate what he had said as to his level of activity and loss of earning capacity. Alternatively, it was submitted that the trial judge erred in failing to give any sufficient reasons for not drawing that adverse inference against the respondent. Those submissions are contained in grounds 22 and 23 of the further amended notice of appeal.

145 The appellant submitted that the trial judge should have drawn an adverse inference against the respondent for failing to call his carer (Gwen), his son (Travis), the owner of the house in which he resided (Neville Howell) and the owner of the canoe hire business (Rob Asplin). Senior counsel submitted that there was an unexplained absence of those four witnesses from the respondent's case. He submitted that the respondent could have been expected to call them as witnesses on his behalf, if they could have given evidence supporting his evidence, as to his level of activity and his involvement in the boat hire business. On the other hand, senior counsel for the respondent submitted that there was no property in witnesses. He further submitted that it was unusual, in a serious injury application, to call a number of corroborating witnesses. The attack on the respondent, in relation to his activities depicted on the surveillance video, only emerged during the cross-examination, at a time at which it was too late for the respondent, in any event, to call the witnesses.

146 The principles, relating to the submission by the appellant, are conveniently contained in the joint judgment of Newton and Norris JJ in O'Donnell v Reichard:[27]

... for the purposes of the present case the law may be stated that where a party without explanation fails to call as a witness a person whom he might reasonably be expected to call, if that person's evidence would be favourable to him, then, although the jury may not treat as evidence what they may as a matter of speculation think that that person would have said if he had been called as a witness, nevertheless it is open to the jury to infer that the person's evidence would not have helped that party's case; if the jury draw that inference, then they may properly take it into account against the party in question for two purposes, namely:

(a) In deciding whether to accept any particular evidence, which has in fact been given, either for or against that party, and which relates to a matter with respect to which the person not called as a witness could have spoken; and

(b) In deciding whether to draw inferences of fact, which are open to them upon evidence which has been given, again in relation to matters with respect to which the person not called as a witness could have spoken.[28]

147 The application of those principles must be tailored, of course, to the particular issues in the case, and also to the nature of the proceeding. In serious injury applications, it is not unknown for a plaintiff to support his or her case with an affidavit from a corroborating witness. However, in those applications a plaintiff does not, commonly, call the same amount and array of such witnesses as might be expected on a common law trial.

148 In the present case, the evidence of Mr Howell and Mr Asplin would have been principally directed to the issue, which was agitated in cross-examination, namely, whether the respondent was being remunerated for the work which he performed in the boat hire business and the canoe hire business. However, in final address the appellant, quite properly, recognised that it did not have sufficient evidence to found a submission that the trial judge should infer that the respondent was engaged in the boat hire business for reward. Accordingly, in the context of the issues which were ultimately decided, and in the context of a serious injury application, it was not necessary for the judge to consider the 'Jones v Dunkel' inference relating to Mr Howell and Mr Asplin.

149 However, and in any event, the trial judge did address the absence of any corroborating evidence in [71] of her Honour's reasons. There, her Honour recognised that there was no 'lay evidence' to corroborate what the respondent had said as to his level of activity. However she considered that the respondent gave consistent accounts of his condition to all medical witnesses, and that he had made appropriate concessions in cross-examination.

150 Thus, the trial judge did recognise the relevance of the failure of the respondent to call corroborative evidence, and in particular that of his carer Gwen and his son Travis. Nevertheless, her Honour concluded that she should accept the respondent's credibility as to his level of activity, and therefore reject the submission of the appellant that she could not rely on the information given by the respondent to the medical practitioners.

151 As the authorities to which I have just referred make plain, a trial judge (or jury) is entitled to rely on the failure of a party to call a witness who was in his or her 'camp' for the two purposes stated by Newton J and Norris J in their judgment in O'Donnell v Reichard. However, the tribunal of fact is not obliged to draw that inference. Notwithstanding the absence of corroborative witnesses who the party might be expected to call, the tribunal of fact is free, nevertheless, to accept the evidence of the particular party as credible. That proposition is trite law.

152 On the other hand, where a party fails to call a witness, particularly where that witness is someone who, as a matter of common sense and ordinary experience of daily affairs, it might be expected the party would have called if that witness had supported the party, a failure to call that witness does add substantially to an attack on that party's evidence. In those circumstances, such a failure adds to the importance of the trial judge stating reasons why, notwithstanding the absence of that witness, the trial judge accepts the credibility of the evidence of the particular party.

153 In this case, the failure of the respondent to call in evidence, particularly, the respondent's carer Gwen, was significant. The evidence demonstrates that Gwen would have been a person who could have given firsthand evidence of the day to day limitations and restrictions of which the respondent complained, and of his day to day psychological and emotional state. That evidence would have been important in countering the strong impression, as to the respondent's physical capabilities and his psychological state, which is derived from a viewing of the surveillance video. The fact that the trial judge accepted the respondent's credibility, notwithstanding the absence of evidence from the carer Gwen, added measurably to the importance of the trial judge giving reasons for her Honour's acceptance of the credibility of the respondent's evidence. In particular, it accentuated the requirement to give reasons why, notwithstanding the level of activity depicted on the video, the trial judge nevertheless accepted the respondent's description of the level of his disability. Equally, it accentuated the requirement for the trial judge to address the apparent discrepancy between the respondent's level of involvement in the boat hire business, depicted in the video, and the account of his activities given by the respondent to various medical practitioners.

154 In those circumstances, while I do not consider that grounds 22 and 23 of the further amended notice of appeal are made out, nevertheless those grounds are relevant to the conclusions which I have already drawn concerning the adequacy of the trial judge's reasons concerning the acceptance by her Honour of the respondent's credibility.

155 The conclusions, which I have thus far reached, are sufficient to dispose of this appeal. I shall therefore deal, briefly, with the other matters which were argued on appeal.

The surveillance video: Jones v Dunkel inference (ground of appeal 21)

156 Ground 21 of the appeal alleges that the trial judge erred in drawing an adverse inference in relation to surveillance film not shown to the respondent in cross-examination.

157 The factual basis upon which the ground is based is not entirely clear. At the conclusion of evidence, counsel made an admission on behalf of the appellant that the respondent had been subjected to 79 hours of surveillance. The surveillance video shown to the respondent in cross-examination, in total, covered approximately two hours of surveillance. The defendant had conducted 45 hours' surveillance of the plaintiff in 2008. The defendant had disclosed to the plaintiff the 2008 video footage, but did not play it, or tender it, in evidence. The defendant conducted 32 hours' surveillance of the plaintiff between 16 January and 28 January 2011. In the course of cross-examination of the plaintiff, the defendant tendered in evidence the video footage taken between those dates. The video footage, available to the Court of Appeal, covered some seven hours' surveillance in January 2011.

158 In any event the trial judge inferred that the film, not shown to the respondent, would not have assisted the appellant.

159 Strictly, the inference, under Jones v Dunkel, was not open to be drawn in relation to the surveillance video which was in fact tendered in evidence, notwithstanding that it was not shown to the respondent in cross-examination. However, the point made by the appellant, in this regard, does not go anywhere. The trial judge, having noted that she could infer that the film, not shown, would not have assisted the appellant, did no more than accept that the video, shown to the respondent, was a 'snapshot in time'. While, as I have earlier stated, that description of the two hour video is not entirely accurate, nevertheless her Honour did not otherwise use, in her reasoning, the fact that the remaining video was not shown to the respondent, to weaken any inference drawn from the film, which was shown to the respondent, or to reinforce the respondent's evidence. Thus, ultimately the observation made by the trial judge, that the film not shown to the respondent would not have assisted the appellant, did not, in any impermissible way, affect the reasoning of the trial judge.

160 Before departing from this point, I should note that, where a large block of surveillance video is tendered, but only part of it shown to a plaintiff, it is preferable to clarify what parts of the video are received in evidence. Counsel should specify to the trial judge whether the whole of the surveillance footage, which is contained in the disc tendered to the Court, is tendered in evidence, and, if not, what part or parts of the recording on the disc is or are to be tendered in evidence. That was not done in this case. In addition, on appeal, the Appeal Book should also specify whether the whole of the surveillance footage, which is contained in the disc, tendered to the Court, was tendered in evidence, and, if not, what part, or parts, of the recording on the disc was or were tendered in evidence. That was not done on this appeal.

The trial judge's treatment of the medical evidence (ground 3)

161 Ground 3 of the further amended grounds of appeal contends that the trial judge failed to carry out a sufficient analysis and comparison of the medical evidence in relation to the respondent's injuries. In support of that ground, counsel for the appellant submitted that the trial judge failed to carry out an analysis of conflicts in the evidence of the medical practitioners, for example, between that of Associate Professor Wallin on the one hand, and Mr Scott and Mr Dooley, on the other hand, concerning the extent of the injuries to the respondent's elbows.

162 That ground of appeal, and submission, must be viewed in light of the manner in which the case was presented to the trial judge. In opening the case, senior counsel for the respondent stated that, based on the reports of the medical practitioners relating to the respondent's psychiatric state, there was little controversy that the respondent had suffered a major depressive disorder. He referred to the reports of Mr Sullivan and Dr Entwistle, and quoted from the reports of Dr Payne, Dr Epstein and Dr Dush Shan. Senior counsel then referred the trial judge to the medical evidence relating to the respondent's elbow injuries. He referred to the evidence of Dr Chan, Associate Professor Wallin, and Mr Scott, and quoted from the reports of Mr Grossbard and Mr Dooley. At the conclusion of the opening, as I have already noted, senior counsel for the appellant foreshadowed the issues which would need to be determined by the trial judge. In doing so, he accepted that there was a 'battery of psychiatric opinion fortifying the plaintiff's case', but stated 'our submission is that it is based on a wrong factual matrix'. He then foreshadowed the submission that the respondent had feigned his disability to the medical practitioners.

163 As I have already stated, there was no cross-examination on behalf of the appellant of any of the medical practitioners, whose reports were tendered in evidence, other than Dr Payne. In final address, counsel for the appellant did not analyse the medical reports, or make any submission as to which practitioner's opinion should be preferred, should the trial judge be satisfied that the respondent was a credible witness.

164 In that way, by the conclusion of the hearing of the trial, the learned trial judge was left with a body of medical reports, and without any submissions made on behalf of the appellant (or the respondent) as to any of the conflicts within them. Some of the conflicting medical evidence - particularly the competing conclusions relating to the nature and extent of the respondent's elbow injuries - were irreconcilable in the absence of cross-examination of the medical practitioners. In those circumstances, in my view, the trial judge was entitled to assume that if the underlying factual matrix, upon which the respondent's medical practitioners' reports were based, were not disturbed, then the opinions stated by those medical practitioners, tendered on behalf of the respondent, could be accepted and relied on.

165 Thus, in light of the manner in which the issues were agitated at trial, I do not consider that ground 3 of the grounds of appeal should succeed.

The findings by the trial judge as to loss of earning capacity (Grounds of appeal 14, 15, 16, 17(b), 18)

166 The further notice of appeal contained a number of grounds concerning the finding by the trial judge in relation to the respondent's claim for loss of earning capacity. Five of those grounds were the subject of brief written submission. They were not addressed in oral submission before the court.

Woolworths Ltd v Warfe [2013] VSCA 22

At a glance

Court

Decision date

Before

Source

Judgment (231 paragraphs)

Woolworths Ltd v Warfe [2013] VSCA 22 (19 February 2013)

Parties

Legislation Cited (2)

Cases Cited (10)