Alchin v Daley

[2009] NSWCA 418

New South Wales

Court of Appeal

CITATION:	Alchin v Daley [2009] NSWCA 418
HEARING DATE(S):	10 December 2009
JUDGMENT DATE:	18 December 2009
JUDGMENT OF:	McColl JA at 1; Young JA at 2; Sackville AJA at 3
DECISION:	1. Appeal allowed. 2. Set aside Orders 1 and 3 made by Sorby DCJ on 6 March 2009. 3. Order that the matter be remitted to the District Court for a new trial. 4. The costs of the first trial to be determined by the District Court on the retrial. 5. The respondent pay the appellant’s costs of the appeal. 6. The respondent, if otherwise qualified, to have a certificate under the Suitors’ Fund Act 1951.
CATCHWORDS:	REASONS - personal injuries claim - respondent trips over obstacle at night - action against licensee of hotel - whether primary judge gave adequate reasons for finding that the lighting was poor - whether primary judge erroneously inverted the burden of proof borne by the respondent.
LEGISLATION CITED:	Civil Liability Act 2002, s 16(1), s 16(3), s 50 Civil Procedure Act 2005, s 56 Supreme Court Act 1970, s 75A(5), s 75A(6)(b), s 75A(10) Uniform Civil Procedure Rules 2005, r 51.53(1), r 51.53(2), r 51.53(5)
CATEGORY:	Principal judgment
CASES CITED:	Folkes v Calabaro [2004] NSWCA 191 Goodrich Aerospace Pty Ltd v Arsic [2006] NSWCA 197; 66 NSWLR 186 Hare v Harmer [2009] NSWCA 68 Parsons v Randwick Municipal Council [2003] NSWCA 171 Pollard v RRR Corporation [2009] NSWCA 110 Qushair v Raffoul [2009] NSWCA 329 Tory v Megna [2007] NSWCA 13 Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816
PARTIES:	Neville James Alchin (Appellant) William George Daley (Respondent)
FILE NUMBER(S):	CA 40109/2009
COUNSEL:	J E Maconachie QC; S E McCarthy (Appellant) B Dooley SC; M Best (Respondent)
SOLICITORS:	Davidson Garethy Lawyers (Appellant) Fatches Jones (Respondent)
LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S):	DC 1/2008
LOWER COURT JUDICIAL OFFICER:	Sorby DCJ
LOWER COURT DATE OF DECISION:	6 March 2009

CA 40109 of 2009

McCOLL JA
YOUNG JA
SACKVILLE AJA

18 December 2009

NEVILLE JAMES ALCHIN v WILLIAM GEORGE DALEY

Judgment

1 McCOLL JA: I agree with Sackville AJA.

2 YOUNG JA: I agree with Sackville AJA.

3 SACKVILLE AJA: This is an appeal against a decision of a Judge of the District Court (Sorby DCJ) given at the Maitland District Court on 6 March 2009. His Honour entered judgment for the plaintiff, the respondent in this Court against the first defendant, the appellant in this Court, in the sum of $206,525.

4 The respondent claimed damages for personal injuries he sustained in consequence of a fall at the rear of the licensed premises known as the “Ballina Hotel”. The appellant was the licensee and occupier of the Ballina Hotel. The fall occurred at about 10.30 pm on 6 January 2005. At the time, the respondent was 54 years of age.

BACKGROUND FACTS

5 The following account sets out the facts not now in dispute, except where specifically noted.

6 In November 2004, the respondent obtained work as a casual bar person at the Ballina RSL Club. In late November 2004, the appellant, who was acquainted with the respondent, offered the respondent the use of a room in the upstairs section of the Ballina Hotel. Two staff members of the Hotel occupied other rooms in the upstairs section, which had a common kitchen area.

7 The respondent could gain access to his room through the downstairs area of the Ballina Hotel when the Hotel was operating. However, at other times, the respondent, with the appellant’s permission, used a side entrance. This was located at the end of a passageway, which led to the entrance via a right hand turn from the bottle shop driveway. The respondent gained access to his room by ascending a staircase located inside the entrance, using keys supplied by the appellant to unlock a metal gate at the side entrance.

8 The respondent sustained his injuries when he tripped over pallets on which empty beer kegs were stacked. The pallets had been placed at the junction of the bottle shop driveway and the passageway leading to the side entrance to the Hotel.

9 The area is shown on the plan reproduced below, which was prepared by Mr Cowling, an engineer who prepared a report tendered at the trial on behalf of the respondent. In addition to the driveway, the (unmarked) passageway and staircase, the plan shows the location of the “Nite Club” entrance adjacent to the staircase, the covered awning leading to the “Nite Club” entrance and the location of several lights that were the subject of evidence. It should be noted that the plan incorrectly records that the respondent “tripped on [an] empty pallet”.

10 One of the lights noted on the plan was a fluorescent light above the roller door at the rear of the bottle shop, positioned about 3.1 metres from the ground. A second light was located above the doorway entrance to the “Nite Club”, 3.9 metres from the ground. The primary Judge appeared to accept (at [5]) that this was a 1,200 mm double fluorescent light. A third light (not identified on the plan) was located at the top of the staircase, inside the entrance door to the rear of the hotel. In his evidence, the respondent described the third light as “just like a globe”, although his Honour referred to it (at [22]) as a “spotlight”.

11 The plan also identifies a “New quartz-halogen floodlight”. The evidence established that the appellant had not put in the new light and that it was installed after he ceased to be the licensee of the Ballina Hotel. While it might be inferred that the light was installed on the instructions of the appellant’s successor as licensee of the Hotel, the evidence did not address the reasons why the halogen light had been placed in that position.

12 On 6 January 2005, the respondent was off work and spent the day reading and shopping. There was a dispute as to whether he was inebriated by the early evening. In any event, the respondent went to the RSL Club at about 6.30 pm and remained there until about 10.15 pm. During this period, he played poker machines and had a number of alcoholic drinks.

13 The respondent left the RSL Club in the company of a workmate identified only as “Barry”, who was working at the Club. The respondent’s intention was to drink a bottle of wine with Barry in his (the respondent’s) room. (Barry did not give evidence at the trial; the respondent apparently had been unable to locate him.)

14 The respondent and Barry made their way to the bottle shop driveway. As they approached the corner of the driveway and were about to walk to the right into the passageway leading to the metal gate at the rear of the hotel, the respondent turned to give Barry the bottle of wine so that he could retrieve his keys from his pocket. On the respondent’s account, at that point his right foot came in contact with the pallets and he fell forward, landing on the empty kegs and then, left shoulder first, on to the concrete floor of the passageway. As a result of the fall, he suffered a fractured clavicle.

CONFLICTING ACCOUNTS

15 It is important to appreciate that the appellant and respondent gave sharply conflicting accounts as to the circumstances in which the respondent came to sustain his fall.

16 On the respondent’s account:

he had used the side entrance to the hotel at night on about 15 occasions before the accident and had never seen pallets or kegs stacked at the rear of the bottle shop near the corner, although he had seen them placed in the driveway itself;
there was a large icebox, measuring about 2 metres in height, 2 metres in length and 1.2 metres in width, in the area but it was located inside the bottle shop (not in the driveway);
whenever he used the passageway at night, the light was so poor that he had to use two hands to unlock the entrance gate at the rear of the hotel, one to find the keyhole and the other to insert the key;
the light at the “ Nite Club ” entrance had never been illuminated when he used the passageway to gain access to the hotel at night;
the light at the top of the stairs was not illuminated every night;
he had not been drinking at the Ballina Hotel before proceeding to the RSL Club on the evening of the accident;
at the time of the accident it was difficult to tell whether the light above the roller door was on because it was dirty and covered with insects, but there was no light coming from the “ Nite Club ” entrance; and
at the time of the accident, the lighting in the area from all sources was poor.

17 The appellant gave evidence that:

pallets and kegs had regularly been stacked at the rear of the bottle shop, near the corner, in order to allow the brewery truck to collect empty kegs and replace them with full kegs;
pallets and kegs had never been stacked on the driveway;
the icebox was not located inside the bottle shop but in the driveway, at a point very close to the intersection of the driveway and the passageway;
the light above the “ Nite Club ” entrance was always kept on for safety and security purposes, in accordance with the conditions of the hotel licence (which required entrances and exists to be illuminated);
his practice was to check each night after the Ballina Hotel closed to ensure that the external lighting was working;
he checked the lighting on 6 January 2005, shortly before the accident, and again the next morning;
his observation was that there was “ plenty of lighting in the [area of the pallets] ”; and
he had observed the respondent in an obviously inebriated state in the bar of the Ballina Hotel at about 7 pm on 6 January 2005 and had refused to serve him (the respondent).

CIVIL LIABILITY ACT

18 One issue at the trial was whether the provisions of s 50 of the Civil Liability Act 2002 were attracted. Section 50 relevantly provides as follows:

“(1) This section applies when it is established that the person whose death, injury or damage is the subject of proceedings for the recovery of damages was at the time of the act or omission that caused the death, injury or damage intoxicated to the extent that the person’s capacity to exercise reasonable care and skill was impaired.
(2) A court is not to award damages in respect of liability to which this Part applies unless satisfied that the death, injury or damage to property (or some other injury or damage to property) is likely to have occurred even if the person had not been intoxicated.
(3) If the court is satisfied that the death, injury or damage to property (or some other injury or damage to property) is likely to have occurred even if the person had not been intoxicated, it is to be presumed that the person was contributorily negligent unless the court is satisfied that the person’s intoxication did not contribute in any way to the cause of the death, injury or damage.
(4) When there is a presumption of contributory negligence, the court must assess damages on the basis that the damages to which the person would be entitled in the absence of contributory negligence are to be reduced on account of contributory negligence by 25% or a greater percentage determined by the court to be appropriate in the circumstances of the case.”
THE PRIMARY JUDGMENT

19 The primary Judge noted that there was no issue that the appellant, as the licensee of the Ballina Hotel who had invited the respondent to occupy a room in the Hotel, owed the respondent a duty of care. His Honour identified (at [12]) the two critical factual issues to be resolved, as follows:

“1. Did the [appellant] breach his duty to the [respondent] by stacking the pallets and empty kegs at the entrance to the open passageway used by the [respondent] after hours in circumstances where, because of the poor lighting, the pallet and empty kegs contributed a hazard and therefore a danger to persons such as the [respondent] [?]
2. Was the [respondent] so intoxicated at the time of his tripping over the pallet and keg that s 50 of the Civil Liability Act 2002 (NSW) … was invoked [?]”
Breach of Duty

20 The primary Judge accepted (at [15]) the appellant’s evidence that his practice was to roll out empty kegs from the bottle shop and stack them on pallets at the rear of the bottle shop. His Honour therefore accepted the appellant’s evidence as to the location of the pallets and kegs in preference to that of the respondent. However, according to the primary Judge (at [14]), no evidence had been given as to the frequency with which beer suppliers had collected empty kegs from the rear of the bottle shop and delivered full kegs. In the absence of such evidence, his Honour accepted the respondent’s evidence that on each of the 15 or so occasions he had used the rear entrance to the hotel after dark, no pallets or kegs had been stacked at the rear corner of the bottle shop. (It is clear that the primary Judge was mistaken as to the evidence concerning delivery of beer kegs, since the appellant’s uncontradicted evidence was that suppliers delivered kegs twice a week. It follows that the finding that the respondent had never seen pallets or kegs stacked behind the bottle shop near the corner, may well have been influenced by his Honour overlooking the appellant’s evidence. In the end, nothing turns on this mistake.)

21 The primary Judge then made (at [16]) a rather curious finding that the respondent was aware that, from time to time, pallets and empty kegs were stacked in the vicinity of the rear of the bottle shop, but thought that they were mainly stacked in the driveway. His Honour did not explain how the respondent could have formed this impression, given the finding as to the location of the pallets and kegs and the appellant’s explanation for them being stacked at that location.

22 On the basis of the photographic evidence, the primary Judge found (at [17]–[18]) that the wooden pallets and kegs were easily visible in daytime. At night:

“[t]he size and colour (of the kegs) would make them visible to someone who knew of their presence and if the area had adequate lighting.
If their presence at the corner of the bottle shop was unexpected and the area poorly illuminated, then in my view they could contribute a hazard to persons such as the [respondent].” (Emphasis added.)

23 These findings are also somewhat curious, as it is difficult to understand how the visibility of the pallets and the kegs at night could depend upon a person’s prior knowledge of their presence. If a person gaining access to the side entrance to the Hotel via the driveway and passageway was unaware that pallets and kegs were stacked in the vicinity, he or she might not be on the lookout for such objects. But the person’s awareness, or lack of awareness, that objects were nearby would not affect the extent to which those objects were visible at night.

24 The primary Judge next addressed the conflict in evidence concerning the location of the large icebox. He found that the respondent “was mistaken” in thinking that the icebox was inside the bottle shop. His Honour accepted (at [20]) the appellant’s evidence that the icebox was located in the driveway, although not in the precise location the appellant identified. His Honour added the qualification because a photograph taken shortly after the events demonstrated that the icebox was not as close to the corner as the appellant had suggested. Accordingly, the respondent:

“[i]n rounding the corner of the driveway on the evening of 6 January 2005 with Barry would not necessarily have come across the pallet and kegs in his direct line of vision and therefore be alerted [to] their presence in his path.”

25 The primary Judge identified (at [21]) the next question as:

“whether the lighting in the rear walkway was sufficient to enable the [respondent] to avoid the unexpected hazard of the pallet and kegs.”

26 His Honour accepted (at [23]) the appellant’s evidence that the light at the “Nite Club” entrance was kept on for safety and security purposes. However, without expert evidence, the primary Judge was unable to determine whether the light from that source was sufficient to illuminate the pallets and kegs.

27 The primary Judge observed (at [22]) that what he described as the “spotlight” at the top of the stairs had not been the subject of comment by the engineer, Mr Cowling. According to his Honour, there was no evidence as to the distance between the spotlight and the metal gate at the front of the stairs, nor as to the distance between the spotlight and the pallets and kegs located at the rear corner of the bottle shop. Further, there was no evidence as to the strength of voltage in the spotlight.

28 Having reached his point, his Honour resolved (at [23]) the question of lighting as follows:

“In my view [the respondent] was mistaken about the light under the awning, but he was adamant that the amount of light in the walkway from all sources was poor and he had difficulty negotiating his way, because of the lack of light, to the metal gate and opening it with the key. I accept his evidence as to the poor quality of the light in the walkway on the occasions [the respondent] used that entrance including the night of 6 January 2005.”

29 The primary Judge reached the following conclusions on liability (at [43]–[44]):

“the [appellant] owed the [respondent], an invitee, a duty of care as occupier and he breached that duty when he placed a pallet and kegs at the rear corner of the bottle shop in circumstances where he knew or might to [sic] have known that the [respondent] would use the passageway after dark to access the premises using keys made available by the [appellant] and the placing of the pallet and kegs in that location was such that a reasonable man in the [appellant’s] position would have foreseen that his conduct involved the risk of injury to persons such as the [respondent]. In my view there was a real risk of injury to the [respondent] as the [respondent] used the back entrance of the hotel after the hotel closed, he being a shift worker. Such a risk could have been alleviated by stacking the pallet and kegs elsewhere in the bottle shop driveway and or by increasing the amount of illumination in the immediate area which was subsequently done (but not by the [appellant]) by the installation of a halogen light above the rear corner of the bottle shop above the walkway.
I therefore find the [appellant] guilty of negligence.”
The Respondent’s State of Intoxication

30 Although the appellant had given evidence that he had refused to serve alcohol to the respondent early in the evening of 6 January 2005, the primary Judge found (at [34]) that the respondent would not have been admitted to the RSL Club that night had he been in an intoxicated state, particularly if he was an employee of the Club, off duty or not. His Honour pointed out that the appellant had confirmed in his evidence that the RSL Club had a strict policy of excluding inebriated patrons. The primary Judge expressed his finding as follows:

“I therefore find the appellant’s evidence on this matter unconvincing and I am not prepared to find [the respondent] intoxicated when he went to the R.S.L. on 6 January 2005.”

31 His Honour then dealt with the evidence relating to the treatment of the respondent after the accident. The notes of the treating doctor at Ballina Hospital recorded:

“difficult to examine; alcohol ++; alcoholic.”

In her evidence, the treating doctor said that she had no specific recollection of her observations of the respondent on his admission to Ballina Hospital. However, she said that the notation “ alcohol ++ ” denoted that the patient had consumed more alcohol than the average patient admitted to the Emergency Department and was significantly intoxicated. However, the ambulance notes did not record the presence of alcohol on the respondent, nor any behaviour that indicated that he was intoxicated. A friend of the respondent gave evidence that she had received a phone call in which she heard the respondent speak shortly after the accident and had formed the impression that his speech was clear and not slurred.

32 In these circumstances, his Honour concluded, on the balance of probabilities (at [38]–[41], [45]):

“that at the time of his fall on 6 January 2005 [the respondent] was intoxicated from alcohol, but not excessively so, as the result of the alcohol he had consumed at the RSL the previous evening.
I further find that the [respondent] was intoxicated to an extent that it affected his capacity to exercise reasonable care and skill in the circumstances in which he found himself, namely in a dimly lit passageway at the rear of the [appellant’s] premises behind the bottle shop…
I further find on the balance of probabilities that the location of the pallet and kegs at the corner of the passageway, not seen in that location before by the [respondent] meant that the injury to the [respondent], by tripping, would have [sic] likely to have occurred even if the [respondent] had not been intoxicated.
I am satisfied … that his level of intoxication did contribute to him tripping on the pallet.
Applying s 50 of the Act and the findings I have made relevant to that section, particularly, subsection (3) I find contributory negligence of 30%”.


Damages

33 The primary Judge awarded the respondent damages of $206,525, made up as follows:

$685.25 for past medical expenses;
$6,650 for future medical expenses;
$63,000 for non-economic loss based on an assessment that the respondent’s non-economic loss was 28% of a most extreme case ( Civil Liability Act, s 16(1), (3));
$22,260 for past economic loss from 6 January 2005 to 24 October 2005 when the respondent was totally unfit for work (allowed at $530 per week for 42 weeks);
$73,960 for past economic loss from 25 October 2005 until the date of the trial (16 February 2009) when the respondent was fit only for light duties ($430 per week for 172 weeks);
$106,214 for future economic loss based on a loss of $430 per week earning capacity ($430 per week for 290.6 weeks, less 15% for vicissitudes);
$22,268 for past and future loss of superannuation benefits; and
a reduction of the above amounts by 30% to allow for the respondent’s contributory negligence.

GROUNDS OF APPEAL

34 The appellant’s notice of appeal identifies nine grounds of appeal. In substance, the grounds as developed by Mr Maconachie QC, who appeared with Mr McCarthy for the appellant, can be distilled to four arguments, as follows:

the primary Judge failed to engage with the appellant’s case on the issue of whether he had taken reasonable steps to provide adequate lighting and, in consequence, had failed to provide adequate reasons for finding that the passageway was inadequately lit at the time the respondent sustained his injuries;
the findings as to the inadequacy of the lighting were based on an inversion of the proper burden of proof (this ground was not specifically identified in the notice of appeal, but Mr Dooley SC, who appeared with Mr Best for the respondent, did not object to the point being taken);
the findings as to the respondent’s level of intoxication were against the weight of the evidence and, in any event, his Honour’s assessment of contributory negligence was too low; and
the assessment of damages for past and future economic loss failed to take account of the respondent’s long history of unemployment until shortly before he was injured, his pre-existing medical conditions and his failure to seek “ meaningful work ” to mitigate his loss.


REASONING

Principles

35 There was no dispute as to the principles to be applied in determining whether a trial Judge has given adequate reasons for making findings of fact. McColl JA stated the principles, supported by detailed citation of authority, in Pollard v RRR Corporation [2009] NSWCA 110. The principles articulated in that case were summarised in Qushair v Raffoul [2009] NSWCA 329, at [52], per Sackville AJA, with whom Campbell JA and Bergin CJ in Eq agreed (the paragraph references are to McColl JA’s judgment in Pollard):

“(i) The giving of adequate reasons lies at the heart of the judicial process, since a failure to provide sufficient reasons can lead to a real sense of grievance because the losing party cannot understand why he or she lost (at [57]): see Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430, at 442, per Meagher JA.

(ii) While lengthy and elaborate reasons are not required, at a minimum the trial judge’s reasons should be adequate for the exercise of a facility of appeal, where that facility is available (at [56]): see Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247, at 260, per Kirby P; at 269, per Mahoney JA.

(iii) The extent and content of the reasons will depend on the particular case and the issues under consideration, but it is essential to expose the reasoning on a point critical to the contest between the parties (at [58]): see Soulemezis v Dudley , at 259, per Kirby P; at 280, per McHugh JA. This may require the judge to refer to evidence which is critical to the proper determination of the issue in dispute (at [62]): Beale v GIO , at 443, per Meagher JA.

(iv) Where credit issues are involved, it is necessary to explain why one witness is preferred to another. Consequently, bald findings on credit, where substantial factual issues have to be addressed, may not comply with the common law duty to give reasons (at [65]): Palmer v Clarke (1989) 19 NSWLR 158, at 170, per Kirby P (with whom Samuels JA agreed).

(v) Where an appellate court concludes that the trial judge has failed to give adequate reasons, the court has a discretion whether or not to direct a new trial. If, despite the inadequate reasons, only one conclusion is available, a new trial may not be necessary (at [67]).”

36 In Pollard, McColl JA also cited with approval a passage from the judgment of Ipp JA, with whom Mason P and Tobias JA agreed, in Goodrich Aerospace Pty Ltd v Arsic [2006] NSWCA 187; 66 NSWLR 186, at 191-192 [28]. The passage, including the succeeding paragraph (at [29]) is as follows:

“It is not appropriate for a trial judge merely to set out the evidence adduced by one side, then the evidence adduced by another, and then assert that having seen and heard the witnesses he or she prefers or believes the evidence of the one and not the other. If that were to be the law, many cases could be resolved at the end of the evidence simply by the judge saying: ‘I believe Mr X but not Mr Y and judgment follows accordingly’. That is not the way in which our legal system operates. …

Often important issues of credibility involve sub-issues. Often, objective facts, or facts that are probable, are capable of having significant bearing on the sub-issues. In cases of this kind, it is incumbent upon trial judges to resolve the sub-issues and to explain, by reference to the relevant facts, the conclusions to which they have come. This having been done, they should then turn to the ultimate facts in issue and explain how their decisions on the sub-issues have assisted them in forming a conclusion on the ultimate issue. It is only when adequate reasons of this kind are given that an unsuccessful party will be able to understand why the judge has believed his or her successful opponent”.

37 Similarly, there was no dispute between parties that the respondent bore the onus of establishing that the state of the lighting was such that the pallets and kegs constituted an unreasonable risk of injury to a person negotiating the driveway and passageway at night and taking reasonable care for his or her own safety: Parsons v Randwick Municipal Council [2003] NSWCA 171, at [41], per Sheller JA (with whom Ipp JA agreed).

Adequate Reasons?

38 The critical factual issue in this case was the adequacy of the lighting in the area where the respondent sustained his injuries by tripping over the pallets. The evidence given by the appellant and the respondent, respectively, as to the adequacy of the lighting was diametrically opposed. It is hardly plausible (and was not suggested on the appeal) that the appellant’s evidence concerning the state of the lighting on the night of the accident was simply mistaken. On his account, he not only checked the lighting every night but he did so both shortly before the accident and on the next morning after the accident and determined that there was plenty of lighting in the passageway. Moreover, on the appellant’s version, there were powerful reasons connected with the conditions of his licence for him to be particularly vigilant on these matters. As the primary Judge pointed out, no expert evidence was adduced as to the adequacy of the lighting in the passageway. If, therefore, the appellant’s evidence that there was “plenty of lighting” was to be rejected, it could only be on the basis that his account was not to be accepted and that the respondent’s account was to be preferred.

39 The primary Judge did not make a finding adverse to the appellant’s credit. It is true that his Honour found the appellant’s evidence that he refused to serve liquor to the respondent in the evening before the accident occurred to be “unconvincing”. However, he based the finding solely on the ground that the RSL Club had a strict policy of excluding inebriated persons and that the policy presumably would have been applied to the respondent had he arrived at the Club in an apparently intoxicated state. Whatever the merits of the primary Judge’s finding on that specific factual question, his Honour made no general finding that the appellant’s evidence was not to be accepted when in conflict with that of the respondent.

40 On the contrary, in dealing with the conflicting evidence relevant to the issue of adequate lighting, his Honour preferred the evidence of the appellant to that of the respondent on a number of significant matters. In particular, he preferred the appellant’s evidence that:

the light at the “ Nite Club ” entrance was illuminated at the time of the accident;
the pallets had never been placed in the driveway but had always been located at the rear of the bottle shop; and
the icebox was not located inside the bottle shop but in the driveway (albeit not in the precise position identified by the appellant).

41 The primary Judge’s preference for the appellant’s evidence on important questions leaves the reader uncertain as to why his Honour concluded that the lighting was “poor”, much less that the lighting was so poor that the pallets, on which silver kegs were placed, constituted an “unexpected hazard” for a pedestrian using the driveway and passageway at night. The judgment does not identify any objective facts that would lend support to the primary Judge’s conclusion that the respondent’s evidence was to be preferred over that of the appellant.

42 His Honour said that he could not determine, in the absence of expert evidence, whether the “Nite Club” light was sufficient to illuminate the pallets and the kegs. It is dubious whether expert evidence is necessarily required to determine a factual question such as the degree of illumination of a particular area: see Parsons, at [53]-[57], per Beazley JA (dissenting, but not on this point). But if expert evidence was important in assessing the degree to which the “Nite Club” light illuminated the pallets and kegs, it was the respondent who bore the burden of proving that the illumination was insufficient.

43 The primary Judge made no finding as to whether the “spotlight” located at the top of the stairs, was illuminated at the time the accident occurred (the appellant’s evidence was that it was illuminated). His Honour observed only that there was no evidence as to the strength of the voltage. But, as I have noted, it was the respondent who bore the burden of proof on the adequacy of lighting and he chose not to adduce any evidence to support his assessment that the lighting was “poor”. The only expert report adduced in evidence, that of Mr Cowling, did not address the adequacy of the lighting since it was prepared on the express assumption that the “side entry was poorly lit”.

44 In these circumstances, it is not apparent why the appellant’s account, supported at least by some objective evidence (such as the need for the licensee of the Ballina Hotel to observe licence conditions), was rejected. Nor is it apparent from the judgment why the respondent, who was found to be mistaken on several important factual questions, was regarded by his Honour as a reliable witness on the critical issue of the quality of lighting at the time the accident occurred. It is to be remembered that, on his Honour’s findings, the respondent, at the time of the accident, was:

“intoxicated to an extent that it affected his capacity to exercise reasonable care and skill in the circumstances in which he found himself.”

45 In essence, having preferred the appellant’s evidence on several contested issues relevant to the question of breach of duty, the primary Judge simply stated that he accepted the respondent’s evidence as to the:

“poor quality of the light in the walkway on the occasions [the respondent] used the entrance including the night of 6 January 2005”.

46 Mr Dooley submitted that the primary Judge was not obliged to spell out every detail of his reasoning process and that his reasoning process was sufficiently exposed. While the first proposition is no doubt correct (Folkes v Calabaro [2004] NSWCA 191, at [9], per Giles JA (with whom Tobias JA and Cripps AJA agreed), his Honour was obliged to explain his reasons for determining critical factual issues in favour of the respondent. This, with respect, he did not do.

47 The most fundamental requirement the reasons for judgment must satisfy is that the losing party must be able to understand why he or she lost. In my opinion, for the reasons I have given, the judgment in this case did not satisfy that requirement.

Burden of Proof

48 In view of the conclusion that the primary Judge did not provide adequate reasons for the finding that the appellant breached his duty of care to the respondent, it is not necessary to determine whether, as the appellant argued, his Honour incorrectly inverted the burden of proof when assessing the adequacy of lighting in the passageway. Nonetheless, I think it appropriate to record that I would also accept the appellant’s argument on this issue.

49 The primary Judge commented on two separate occasions that there were gaps in the evidence on important matters. He pointed out that there was no evidence as to the distance between the “spotlight” at the top of the staircase and the location of the pallets and kegs, nor as to the strength of the voltage in the spotlight. He also noted the absence of expert evidence concerning the degree of illumination provided by the light above the entrance to the “Nite Club”.

50 The primary Judge did not make the obvious point that, as the respondent bore the burden of proving on the balance of probabilities that the lighting was inadequate to prevent the pallets and kegs constituting an unexpected hazard, significant gaps in the evidence might justify the conclusion that the respondent had failed to discharge his burden of proof. Indeed, his Honour did not expressly acknowledge that the respondent bore the burden of proof on the issue of the adequacy of lighting. Had his Honour done so, he might have directed attention to the significance of the fact that the respondent tendered a report from an engineer on the hazard presented by the location of the pallets and kegs, yet apparently chose not to ask the engineer (or any other expert) to address the adequacy of the lighting in the area where the respondent sustained his injuries.

51 When the judgment is read as a whole, I think it is fair to conclude that the primary Judge regarded the absence of evidence on the two issues he identified as supporting the respondent’s case that the lighting was inadequate. Unless the judgment is read in this way, it is very difficult to understand why his Honour thought that the gaps in the evidence supported the findings he made. Accordingly, if it had been necessary to do so, I would have held that the primary Judge erred by failing to apply the correct onus of proof on the issue of the adequacy of lighting in the passageway at the time the accident occurred.

Relief

52 Section 75A(5) of the Supreme Court Act 1970 provides that an appeal in a case such as this is by way of rehearing. The Court determining the appeal has the powers and duties of the court from which the appeal is brought, including (relevantly) powers and duties concerning the drawing of inferences and the makings of findings of fact: s 75A(6)(b). In addition, s 75A(10) of the Supreme Court Act provides that:

“The Court may make any finding or assessment, give any judgment, make any order or give any direction which ought to have been given or made or which the nature of the case requires”.

53 Rule 51.53(1) of the Uniform Civil Procedure Rules 2005 (“UCPR”), directs the Court not to order a new trial on certain specific grounds and “on any other ground unless it appears to the Court that some substantial wrong or miscarriage has thereby been occasioned”. However, the Court has power to order a new trial on any question without interfering with the decision on any other question: r 51.53(2). Rule 51.53(5) provides as follows:

“If the Court orders a new trial, the Court may:

(a) impose conditions on any party for the purposes of the new trial, and

(b) direct admissions to be made by any party for the purpose of the new trial, and

(c) order that the testimony of any witness examined at the former trial may be read from the transcript, instead of the witness being again examined”.

54 When applying r 51.53, the Court must have regard to s 56 of the Civil Procedure Act 2005 which provides that the overriding purpose of the Act and of the UCPR is the “facilitate the just, quick and cheap resolution of the real issues in the proceedings”. (See Tory v Megna [2007] NSWCA 13, at [28], [30] per Spigelman CJ (with whom Beazley and Bryson JJA agreed. Tory v Megna was an appeal which arose from a jury trial, but the principle applies to appeals from non-jury trials.)

55 The application of these provisions has been addressed by the High Court in Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816. In Hare v Harmer [2009] NSWCA 68, it was said (at [47]), per Sackville AJA, (with whom Macfarlan JA and Handley AJA agreed) that:

“ Waterways Authority v Fitzgibbon does not necessarily prevent an appellate court, where the trial judge has been shown to have erred on a factual question, from substituting its own findings of fact for those made by the trial judge. It may be that, once the trial judge’s error is corrected, the probative evidence on a particular issue points to only one conclusion. Alternatively, if the remaining evidence, although conflicting, presents no issue of the reliability or credit of particular witnesses, the appellate court may be in as good a position as the trial judge to resolve the conflict: cf Warren v Coombes [1979] HCA 9; 142 CLR 531, at 551-552, per Gibbs ACJ, Jacobs and Murphy JJ. Moreover, it is necessary to bear in mind the ‘ overriding purpose ’ stated in s 56(1) of the Civil Procedure Act . Nevertheless, Waterways Authority v Fitzgibbon suggests that in a case where there is conflicting oral evidence, or where there is an unresolved dispute as to the reliability of evidence, an appellate court should exercise caution before deciding to substitute its own findings for those made by the trial judge”.

56 Mr Maconachie submitted that if this Court concluded that the primary Judge had erred by providing insufficient reasons or otherwise, the matter should not be remitted for a retrial. He submitted that the evidence was insufficient to satisfy the onus of proof borne by the respondent and thus it was appropriate for this Court to dismiss the proceedings. Mr Dooley resisted the appellant’s submission but did not appear to dispute that, if the primary Judge is found to have erred, the matter should be remitted to the District Court.

57 In the absence of expert or independent evidence as to the adequacy of the lighting at the time of the accident, resolution of this issue requires an evaluation of the credibility of the conflicting accounts given by the appellant and the respondent. This Court is not in a position, without having seen the witnesses, to resolve the conflict between them. While the respondent may well face significant obstacles in making out his case on a retrial, it cannot be said that his description of the state of lighting at the time of the accident is bound to be rejected. The factual dispute can only be resolved by a court that is in a position to evaluate the reliability of the evidence given by the appellant and the respondent.

58 It is always a matter for regret that the parties must be put to the inconvenience and expense of a new trial. Unfortunately, a new trial must be the outcome of this appeal.

Other Issues

59 As the matter is to be remitted to the District Court, it is neither necessary nor appropriate to address the other arguments advanced by the appellant. The determination of the extent of the respondent’s contributory negligence and the assessment of damages (should either issue arise) will depend, in part, upon credibility findings to be made at the retrial.

ORDERS

60 The orders I propose are:

1. Appeal allowed.

2. Set aside Orders 1 and 3 made by Sorby DCJ on 6 March 2009.

3. Order that the matter be remitted to the District Court for a new trial.

4. The costs of the first trial to be determined by the District Court on the retrial.

5. The respondent pay the appellant’s costs of the appeal.

6. The respondent, if otherwise qualified, to have a certificate under the Suitors’ Fund Act 1951.

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