Shorey v Pt Limited as Trustee for McNamara Australia & Ors

[2002] HCATrans 212

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S140 of 2001

B e t w e e n -

ROSE SHOREY

Applicant

and

P.T. LIMITED AS TRUSTEE FOR McNAMARA AUSTRALIA PROPERTY TRUST

First Respondent

CIC INSURANCE LIMITED (In liquidation)

Second Respondent

VENTURE STORES (RETAILERS) PTY LIMITED (In liquidation)

Application for special leave to appeal

GLEESON CJ
McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 31 MAY 2002, AT 10.15 AM

Copyright in the High Court of Australia

_________________

MR D.F. JACKSON, QC:   If the Court pleases, I appear with my learned friends, MR A.S. MORRISON, SC and MR A.C. CASSELDEN, for the applicant.  (instructed by Maurice Blackburn Cashman)

MR B.W. WALKER, SC:   May it please the Court, I appear with my learned friend, MR P.S. JONES, for the first respondent.  (instructed by PricewaterhouseCoopers Legal)

GLEESON CJ:   There is a certificate from the Deputy Registrar that she has been informed by the liquidator for the second respondent that the second respondent does not wish to be represented at the hearing of this matter and will submit to any order of the Court save as to costs.  She has been informed by the liquidator for the third respondent that the third respondent does not wish to take any active part in the matter.  Yes, Mr Jackson.

MR JACKSON:   your Honours, this is a case where, it is submitted, the interests of justice merit the grant of special leave.  May I go to the circumstances for just a moment to indicate why; and there are three particular points I want to make having done that.

Your Honours, the applicant was found to have a psychiatric condition which made her believe that she could not walk.  The contention that the condition was fabricated was rejected at trial, and the endeavour to set that aside by the respondent failed in the Court of Appeal.  Your Honours will see the issues referred to by the primary judge at page 4, lines 32 to 36, where he said:

There is a major question for me to determine:  whether she is deliberately malingering, or whether there is a genuine psychiatric condition – 

et cetera, and he resolved that issue at page 15, line 27 through to page 16, line 7.

Now, your Honours, the critical issue then was whether (a), not of course the only, cause of the “conversion disorder” that he referred to at the top of page 16 was

the back injury that she had sustained in the fall which had occurred on 2 April 1988.  The date is of some significance.  The trial judge held that ‑ ‑ ‑

GLEESON CJ:   Could I ask you a question about that passage on page 16?

MR JACKSON:   Yes.

GLEESON CJ:   I may be misunderstanding it, but I thought he was making two findings there.  First of all, that the back pain as a result of the fall continued for approximately 12 months.

MR JACKSON:   Yes.

GLEESON CJ:   Then an additional finding, as I understood it, that she “continued to experience back and leg pain from time to time as a result of degenerative disease”, and that was aggravated by the fall.

MR JACKSON:   Yes.

GLEESON CJ:   I do not understand that second finding to be limited to 12 months.

MR JACKSON:   No, not at all, your Honour.  That is the first ‑ ‑ ‑

GLEESON CJ:   I, therefore, have some difficulty with the passage on page 43 in paragraph 20.

MR JACKSON:   Your Honour, that is the first point I wanted to make about it really, and that is that your Honours will see at page 16, commencing at about line 27, that there are the two aspects referred to, the initial severe back pain for approximately 12 months and, importantly, your Honour, the continuing back and leg pain as a result of the aggravation by the fall of “degenerative disease of the lumbar spine”.  Your Honours, in the next paragraph on page 16, at line 44, he referred specifically to the fact that there was a continuing physical effect.  Your Honours will see the words:

the effects of the fall are spent ‑ ‑ ‑

that was the argument –

when the back pain due to physical causes ceases.  As I have found, it recurs from time to time.

His Honour must have been referring to what he was referring to a moment before, that is the aggravation by the accident.  Your Honours, he then, as your Honours will see, at page 17 in lines 5 to 29, went on to say three things.  The first was that the slide into the:

symptoms of psychiatric disorder commenced at some stage in 1988 ‑ ‑ ‑

and as I said, the accident was 2 April –

or at the latest on or shortly after –

the husband’s –

death on 1 January 1989 –

which was within a year of course.  The second thing he said was that:

The psychological factors would not have manifested as they did without the back pain.

The third thing was that the fall was a cause. 

Now, your Honours, that is where one goes then to page 42 in the Court of Appeal’s reasons.  Your Honours will see commencing at about line 35 the introductory part, the passage which your Honour the Chief Justice referred a moment ago.  Your Honours will see the last few lines of page 42, his Honour there saying:

as I read his judgment he found that this was only a temporary aggravation.

Your Honours, that seems entirely inconsistent with what the primary judge said, with respect. 

The second thing in relation to that, your Honours, is that one then goes to page 43 in the passage commencing about line 10 and going through to about line 35, where his Honour builds on that assumption.  The problem, your Honours, which arises in relation to what the judge said, particularly in the paragraph numbered 20, is that what the trial judge had said, at page 17 about line 6, was that the conversion disorder had commenced during the 12 month period, that is, within the period, 2 April 1988, following that, and the husband’s death of course was within that period itself. 

Again, in relation to the same passage in the Court of Appeal, the trial judge’s finding had not been a mere temporal observation.  What he said, and this is at page 17 line 16 to which I have taken your Honours already:

The psychological factors would not have manifested as they did without the back pain.

Your Honours, that the first point.  In our submission there is a clear error by the Court of Appeal in that passage.

The second feature, your Honours, relates to the same matter as the first.  It is that there was a body of evidence demonstrating the difficulties in walking had manifested themselves before the husband’s death.  I will not trouble your Honours extracting references in various records, but one sees also the evidence of the applicant’s daughter, Tracey, which is summarised at page 69 by the dissenting judge, Judge Davies, 69 line 14, in a passage which goes through to the top of page 70, about line 7.  Now, your Honours, that evidence is in the supplementary book if your Honours want to go to it, but it is to the effect that his Honour sets out there.

It is apparent, your Honours, that the evidence of the daughter commended itself to the judge because he referred to it specifically when dealing with the question whether there was or was not a fabricated condition.  Your Honours will see that at page 8.  I am sorry, I should have said the top of page 9, where he referred to the fact:

The plaintiff’s daughter, Tracey, gave evidence, essentially confirming her mother’s account.

Your Honours will see that referred to halfway down that page.

The third feature, your Honours, is the position relating to the medical evidence.  Now, it is clear, your Honours, from the primary judge’s reasons that he accepted the evidence of three witnesses:  Doctors Yeo, Phillips and Dyball.  The majority in the Court of Appeal said that Dr Phillips’ evidence, on which Dr Yeo’s evidence was based in part, should not have been accepted.  That is at page 52, line 39, in a passage which – it goes through a number of pages, through to page 58, line 33.  But, in essence, it amounts to this, that Dr Phillips, who is a psychiatrist, had been made aware the night before he gave oral evidence of further information about the applicant and what she had said on various occasions, and that then the cross‑examination of Dr Phillips concluded in the passage your Honours will see at page 57, lines 19 to 41.

Now, Justice Handley on two occasions said, by reference to that passage, that Dr Phillips had withdrawn his opinion in cross‑examination.  You will see those references, page 58 in lines 11 to 24, in paragraph 27, and at page 60, line 12.   Your Honours will also see, if I could go back for a moment, to the top of page 58 that his Honour said:

The re‑examination of Dr Phillips failed to come to grips with this evidence or with the additional history that Dr Phillips had received the night before and during his cross‑examination.

Your Honours, the re‑examination is referred to by Justice Davies at page 64.  Your Honours can see it in the flesh, as it were, if one needs to go to the detail of it.  Your Honours will see at page 64 commencing about line 31, where his Honour extracted two of the answers given by Dr Phillips in re‑examination, which your Honours will see, after all that had been put to him, remained his view.  Accepting Dr Phillips’ evidence must have been due, at least in part, to the impression which his oral evidence made on the trial judge.

Could I say in conclusion these things.  First, this was a very unusual factual case of course.  The second thing is that one is left reading the judgment of the majority in the Court of Appeal with the feeling that the majority’s view was affected by some disquiet about not being able to set aside the finding that her condition was genuine but whether, we would say, for that or other reasons the appeal was not, in our submission, correctly dealt with by the Court of Appeal and it is one of the cases where it is appropriate for this Court to exercise its supervisory function.

GLEESON CJ:   Thank you, Mr Jackson.  Yes, Mr Walker.

MR WALKER:   Your Honours, no credibility component appears from the approach taken by the majority in the Court of Appeal to the crucial evidence of Dr Phillips.  Crucial because Dr Yeo was, as my learned friend has correctly put it, as to the relevant part, dependent upon Dr Phillips’ diagnosis as a psychiatrist.  Dr Dyball did not support the causal thesis for which the plaintiff was contending.

Could I take your Honours to page 55 of the application book.  Dr Phillips, in giving evidence‑in‑chief, had not taken into account what became at trial the all‑important matter in the history, the so‑called stressor involving the highly peculiar circumstances of the plaintiff blaming herself for her husband’s death and for the unresolved grief reaction at other conflicts thereafter; matters which were analysed in tight chronological sequence by Justice Handley.

When Justice Handley then turned to the way in which Dr Phillips’ evidence turned out at trial, at the foot of page 55, lines 36 and following, the doctor starts by accepting that:

“A   If the chronology is correct –

and that is not challenged –

and in fact she was expressing guilt elsewhere two years after the death of her husband –

and that is not challenged.  He is taking that as an assumption ‑

then obviously I have to reconsider the stressor, the death of her husband.

Things go back so far as that expert is concerned.  It would be a legitimate point for my learned friend to make, “How far back, and did the trial judge have the capacity, as a matter of unexpressed credibility finding, nonetheless to find that there was some core or nub of evidence by Dr Phillips which survived?”.  The next page really puts pay to that possibility.  Having been asked whether the death of her husband was capable of causing an unresolved psychological conflict, the answer was:

A.That is always possible.

Now, that appears to be one of the first answers which, according to Justice Davies, was to be simply a concession of “the possibility that Dr Phillips’ view may be incorrect.”  Top of page 65.  It is clearly much more than that.

There are then three “it’s possible” answers at the top of page 56, none of which have to do with the hypothetical possibility of an opinion being wrong, but accepting as an actual possibility that something may have been operating.  Then an important question, “It is often difficult to determine the aetiology?”.  “Extremely difficult” said that witness.  That makes what then appears on page 57 of the utmost importance and a complete justification for the Court of Appeal’s interference with causal inferences drawn from secondary facts based upon uncontested primary facts in the expert’s evidence.

At the top of page 57, the witness, line 9, accepts that one would have to consider the matters which he had not considered.  He does not dispute it is a most difficult case.  Then, in paragraph 55, the conclusion relevantly of the cross‑examination.  Has the cross‑examiner been so bold as to suggest that which ought to be done but which had not yet then been done by the expert:

Q   Sit down and work through all of that with her and it would only be at that point of time, wouldn’t it, that you would be able to say with any confidence (1) what condition this lady has and (2) what the aetiology of that condition is?

The answer is an affirmative which goes even further than the cross‑examiner might have hoped:

A   Well you are perhaps even a little bit more optimistic than I would be.  I certainly agree that armed with additional information to go back and carry out a further examination would be very useful.  Whether I could achieve those two –

now, those two are what she is suffering from and what is its cause:

Whether I could achieve those two end points I’m not quite sure but I would probably be in a stronger position than I am now.

So the position he was in, cross‑examined before his Honour at trial, was that it was somewhat weaker, he having conceded the extreme difficulty of the exercise and that he had not taken into account matters which he was now being asked to assume, matters which this Court knows were facts not mere assumptions, he was saying, “I’m not even in as good a position as to say that I may not be able to diagnose and I may not be able to attribute cause”.  So the question and answer with which that page concludes:

Q   So that even armed with that additional information it still might not be possible to work out exactly what her diagnosis is and what the aetiology of the condition may be?

A   Yes.

What Justice Handley then says, at the top of page 58 in paragraph 56 is, in our submission, an entirely relatively mild and accurate summary of the re‑examination.

GLEESON CJ:   Could I just pause to inquire something that does not seem to appear from material we have, but Dr Phillips found out the night before he gave evidence about this reaction to the death of her husband.

MR WALKER:   That it had been – he knew about the death – the particular pathological aspects of it, yes, your Honour.

GLEESON CJ:   When did he find out that she had blamed herself for the death?

MR WALKER:   During cross‑examination.

GLEESON CJ:   I see.  That answers my question.  He then did not deal in his evidence‑in‑chief with the fact that she had blamed herself for her husband’s death because he only found out about that during the course of the cross‑examination.

MR WALKER:   That is right.  This was cross‑examination which preceded, as I say, to the relatively bold point of having confronted the doctor with matters not taken into account which the cross‑examiner knew he would be able to prove extraneously.  He not only extracted that that would be important, he also managed to obtain ‑ and this was very telling in terms of the forensic course adopted on behalf of the plaintiff, he obtained from the expert not so much a grudging concession as a volunteered proposition that even with the opportunity to sit down with the plaintiff to do some more clinical investigation, even then the cause of her condition, assuming one could diagnose that, might well remain obscure and that he was ‑ ‑ ‑

McHUGH J:   It seems to be the whole thrust of the Court of Appeal judgment overlooks the fact that a doctor in the position of Dr Phillips places great weight on his impression of the witness among other things.  Having seen many doctors cross‑examined, I do not read that cross‑examination as withdrawing his evidence‑in‑chief; anything but.

MR WALKER:   I think your Honour there is referring to line 23 on page 58, which is Justice Handley’s use of the word “withdraw”.  That is a reference back to paragraph 55 from which I have been reading.  It is not, in our submission, an entirely inaccurate proposition that for a witness to say he is in a worse position now as he answers the question than he would be after the possible failure of a future diagnosis and aetiological attribution in the future, it is not inaccurate to say that that withdraws an opinion which is a positive opinion about (a) diagnosis and (b) aetiology.  If he is worse off than perhaps not knowing it now then, in our submission, he cannot possibly still be cleaving to the opinion in‑chief.

GLEESON CJ:   We are in a slightly awkward position here, Mr Walker.  We do not have the whole of the evidence of Dr Phillips.  It may be necessary to look at the whole of the evidence of a witness if the decision of the Court of Appeal turned upon the proposition that for practical purposes a vital witness in the plaintiff’s case withdrew the substance of his evidence.

MR WALKER:   If that were the case it would be perhaps difficult for both sides, particularly for an applicant, in our submission, to show that there was an error requiring, in the interests of justice in the individual case, interference, but the way in which the judgments have been prepared in the Court of Appeal isolate by verbatim quotation what appear from the reasons of their Honours, that is Justice Handley and Justice Davies respectively, to be the testimonial material upon which they depend for the difference between them about Dr Phillips.  Now, Justice Davies must be wrong, with respect, when he characterises the answers about “it’s always possible” et cetera, it merely being a concession of possible error in the witness’ own evidence.  That is not at all what the witness was suggesting.  It makes no sense whatever of the witness describing it as a “very useful exercise to undertake the reinvestigation of matters which would be very important”, and even then conceding that he would not be confident that he would be able to describe either diagnosis or aetiology.

Now, that is a position which was already radically, fundamentally different from what he had done in‑chief.  That is why Justice Handley must be right in saying, “in effect this is a withdrawal”.  It is certainly a movement in a direction which is opposite from that in which his evidence‑in‑chief tendered.  Your Honours do have, I think, in the supplementary volume ‑ ‑ ‑

McHUGH J:   The cross‑examiner did not go for the 100 per cent admission.  If he thought he was in that position I would have thought he would have put it to him.  Having driven the doctor to that stage, an effective cross‑examiner would have gone for the 100 per cent admission.  Then there would be no doubt about it.

MR WALKER:   The difficulty with that of course is the witness has already said he cannot do it, in the witness box.

McHUGH J:   The conclusion of the train of cross‑examination it would have been easy enough to have put to the witness that he now withdraw ‑ ‑ ‑

MR WALKER:   Your Honour, can I remind you ‑ ‑ ‑

McHUGH J:    ‑ ‑ ‑ his evidence‑in‑chief, and if he did not then you would go back over it and attack it, again.

MR WALKER:   Could I attempt to justify the courts below.  If one goes to page 60, paragraph 63, one sees that Dr Dyball’s opinion was that the fall was not causative.  Dr Yeo really did, on this matter of the aetiology of a mental condition, rise no higher – he is a surgeon – than Dr Phillips.  Dr Phillips was the plaintiff’s case on the point.  Dr Phillips did in effect withdraw the opinion by saying he agrees that because of the possibility he conceded, it would be very useful to consider other matters and then he would be in a position to consider diagnosis and aetiology, but he is not in that position at the moment.  He is in a worse position than that at the moment.  That must be a withdrawal of the confident attribution of cause in‑chief.  That is the first point which is corrected by Justice Handley.

McHUGH J:   The judge sees the witness give answers as well.  When the witness says, “It is possible”, he may have said it in all sorts of ways.

MR WALKER:   Your Honour, there is no doubt about the lexical content of those words.  What he was saying was possible was about medical possibilities.

McHUGH J:   Yes, I know.

MR WALKER:   That is not susceptible of any credibility‑based subtlety of meaning.

McHUGH J:   Why not?  The witness might have said ‑ ‑ ‑

MR WALKER:   It cannot mean ‑ ‑ ‑

McHUGH J:   The witness might have said, “It’s possible” just in a sense.  The doctor might have thought it was very remote ‑ ‑ ‑

MR WALKER:   That is why what is found on page 57 is important.  That puts beyond any doubt.  At the top of page 57:

A   Yes, one would have to consider that.

There is nothing that credibility imagination can do to deprive that of force, the careful expert in the witness box.  “One would have to consider it and, it’s difficult and I can’t do it now and even with the opportunity you pose I may not be able to do it then.  I am worse off than that now.”  In that case, in our submission, the Court of Appeal is well within its rights, indeed is complying with its duty to have attended to what the witness actually said upon whom the trial judge depended so crucially for the finding.

McHUGH J:   There seems to be growing in the Court of Appeal a new way of outflanking Abalos.  We have granted special leave in Fox v Percy where a judge’s finding on credibility were set aside.  Today we have three cases all raising the same criticism in the Court of Appeal.

MR WALKER:   I know, your Honour.  I am not suggesting that in itself it is not an important aspect of the administration of justice what intermediate courts of appeal can do and should not do and how they should go about it.  It is self‑evidently so.  That does not mean that ‑ ‑ ‑

McHUGH J:   The Court of Appeal seems to be saying, “Here’s a fact the trial judge did not mention”, notwithstanding he makes the most adverse findings on credibility and then they set aside the verdict.

MR WALKER:   Can I take just this case rather than a general field of cases though, your Honour.  Here there is nothing of that kind.  Here there is nothing about Dr Phillips which is either rendering any of the matters that the trial judge found about this evidence, impregnable to Warren v Coombes investigation, and there is nothing whatever in the Court of Appeal which is illegitimate in respect to the way in which either the witness is treated on the transcript by them or the trial judge’s approach to that witness is treated by them, rather the words upon which the trial judge is clearly depending are looked at for what they are worth.  The test really comes out.  The judgment which would have vindicated the trial judge’s approach, the judgment of Justice Davies, plainly commences with a misconception about what I will call the “lexical content of the transcript”.  That is all he had too.  When one goes to the way in which page 57 starts and finishes, it is clear, with respect, that Dr Phillips was no longer putting forward at that point of the trial the evidence upon which the plaintiff’s case depended.

Now, what the Court of Appeal was doing then was not substituting its own finding at all.  Contrary to the way in which the questions are expressed, in the written submissions before your Honours for special leave, at page 61 paragraph 67 a vitally different approach from that which is mischaracterised in those submissions, appears.  What the court there did was to say in this difficult case, where there were competing hypothesis, the plaintiff failed to discharge the onus of proof.  It was not for the Court of Appeal, on the way the evidence came out on that critical matter of attribution of cause, to say this was due to the death of the husband.

McHUGH J:   Yes, but what about the answer in the middle of 57 at line 36, second sentence in the answer:

I certainly agree that armed with additional information to go back and carry out a further examination would be very useful.

MR WALKER:   Your Honour is presumably suggesting that “very useful” are words ‑ ‑ ‑

McHUGH J:   I am.

MR WALKER:    ‑ ‑ ‑ amenable to a cross‑examiner but containing a concession.

McHUGH J:   That is right.

MR WALKER:   That is why the next sentence is important, because the next sentence says – the witness is talking about his own strength of opinion, and the witness is being praiseworthy in the way he exposes his reasoning, as he should.  In that last answer he describes his present mental position in relation to forming an opinion on the two critical matters, particular the second, aetiology.  But “if I did” what I have just described as “very useful” he says, “if I did that”:

I would probably be in a stronger position than I am now ‑

in the witness box.  Look at the content of what he describes as ‑ ‑ ‑

McHUGH J:   I know, but it is rather – he says, “I’m maintaining my opinion but with a further examination:

I would probably be in a stronger position than I am now.

MR WALKER:   He does not maintain the opinion in that answer at all, your Honour.  What he says is, “The position I am in now” ‑ ‑ ‑

McHUGH J:   The trial judge who saw him may have taken the view that he did.

MR WALKER:   Your Honour, that would be pushing credibility‑based findings beyond the realm of credibility itself.  It defies credulity that one could rationally look at a witness and give as meaning to the testimony recorded in that transcript that the witness was saying, “I am in no weaker a position now than I was when I gave evidence‑in‑chief before I heard about these things”.  Now, that is the only way he would be maintaining his position, because what he says – he is obviously fluent in English – is, “I would probably be in a stronger position than I am in now”.

When one looks at the content of that “stronger position”, it is a position where he says to the cross‑examiner, “Don’t be too optimistic about my capacity” quote, line 30:

to say with any confidence . . . (2) what the aetiology of that condition is.

“Don’t be too optimistic about that”.  If that is the position he is saying would be stronger, in our submission, there was the plain withdrawal.  The

way in which the case was therefore run, in our submission, strongly supports the approach taken by the majority in the Court of Appeal.  The case therefore raises no matter of general principle.  It is simply an example of the Court of Appeal attempting to tread the line between the Warren v Coombes duty and the Abalos restraint.  May it please the Court.

GLEESON CJ:   Yes, Mr Jackson.

MR JACKSON:   Your Honours, the evidence of Dr Phillips is in fact contained in the supplementary book.  May I just say something in relation to it.  Your Honours will see in the evidence‑in‑chief at page 92 commencing at about letter J, you will see in a passage that goes through from letter J through to page 93 in letter M in evidence‑in‑chief.  Dr Phillips was asked to express a view which involved some aspects, particularly between letters O and S on page 92, dealing with the reaction to the husband.  Now he concludes his evidence‑in‑chief at 93M, where he said:

As I said, in my opinion the accident was of prime importance.

He is then cross‑examined, your Honours.  One will see then in the passage at page 96 commencing at, I think, about letter I and goes on for a number of pages, and includes the passages to which your Honours have been referred in cross‑examination, and you see for example at page 99V:

Q.   We certainly know that by 1991 she is presenting with tremendous guilt from the death of her husband, don’t we?
A.   Yes, well you have provided me with information to support that.

He agrees at the top of the next page:

A.I would have to see it as a stressor.  At this stage I’m not sure just how high on the stressor scale it would be but I accept it as a potentially significant stressor.

Now, your Honours, when one comes after that to the re‑examination, what one sees, your Honours, is at page 107, the re‑examination commencing a little on the preceding page.  Then at letter K he was asked, and your Honours will see the question which makes various assumptions, and then his answer is, at letter O:

A.Yes, it is entirely reasonable to see the fall in the shopping centre in 1988 as the event which was the beginning of the downhill course, if you like.

He then says – he assumes that legal evidence has to be one cause rather than multiple ones.  The judge said:

I don’t know about that.

He said, “I withdraw that” in effect.  Then he says:

I believe the accident in the shopping centre and the course which followed remains of very great significance aetiologically.

Your Honours, why, in our submission was the judge not entitled to say, having said him give evidence in the witness box, having seen those questions put to him, having heard him use the expression “possible” “possibility” and so on, when he finally comes in re‑examination why can he not say that that piece of evidence is one which he accepts.  Your Honours, those are our submissions.

GLEESON CJ:   In this matter there will be a grant of special leave to appeal.

AT 10.47 AM THE MATTER WAS CONCLUDED