Worth v Hdi Global Specialty Se

[2021] NSWCA 185

Court of Appeal

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Worth v HDI Global Specialty SE [2021] NSWCA 185

Hearing dates:

19 and 20 November 2020

Date of orders:

26 August 2021

Decision date:

26 August 2021

Before:

Macfarlan JA at [1];
Meagher JA at [7];
McCallum JA at [204]

Decision:

(1) Allow the appeal.

(2) Set aside Order (1) made on 19 March 2020 and Orders (1) to (4) made on 17 April 2020.

(3) Judgment for the appellant against the respondent for the sum of $464,384, together with interest pursuant to Insurance Contracts Act 1984 (Cth) s 57, from 1 January 2016 to 26 August 2021 of $124,649, and $60.39 per day until the date of payment.

(4) Dismiss the cross-claim.

(5) Order the respondent to pay the appellant’s costs at first instance and on appeal.

(6) Direct the appellant within 14 days of today’s date to file a written submission providing her calculation of the interest to be awarded to her, with the respondent to file any differing calculation within 7 days thereafter.

Catchwords:

INSURANCE – where appellant’s house destroyed in a fire – where house used to operate a business – where house and business insured by respondent – where respondent granted conditional indemnity under deed of release – where respondent then denied liability on basis fire deliberately lit by insured – whether primary judge erred in finding appellant deliberately started fire

INSURANCE – measure of indemnity – where lack of reasonable despatch in rectifying property – whether indemnity for property damage payable on reinstatement basis

INSURANCE – damages – whether damages available for consequential loss arising from insurer’s breach of promise to indemnify – whether damages available for inconvenience and distress caused by breach

Legislation Cited:

Enterprise Act 2016 (UK), s 28

Evidence Act 1995 (NSW), s 140(2)

Insurance Contracts Act 1984 (Cth), ss 13, 14(1), 57

Cases Cited:

ApostolosKonstantineVentouris v Trevor Rex Mountain (The Italia Express (No 2)) [1992] 2 Lloyd’s Rep 281

Archibald v Powlett (2017) 53 VR 645; [2017] VSCA 259

Baltic Shipping Company v Dillon (1993) 176 CLR 344

Belhaven and Stenton Peerage (1875) 1 App Cas 278

Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1

Brescia Furniture Pty Ltd v QBE Insurance (Australia) Ltd (2007) 14 ANZ Ins Cas 61-740; [2007] NSWSC 598

Briginshaw v Briginshaw (1938) 60 CLR 336

Browne v Dunn (1893) 6 R 67 (HL)

Chamberlain v The Queen (No 2) (1984) 153 CLR 521

CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2

CIC Insurance Ltd v Bankstown Football Ltd [1994] NSWCA 359; (1995) 8 ANZ Ins Cas 61-232

Globe Church Incorporated v Allianz Australia Insurance Ltd (2019) 99 NSWLR 470; [2019] NSWCA 27

Hungerfords v Walker (1989) 171 CLR 125

Judd & Judd v Suncorp Insurance & Finance (1988) 5 ANZ Ins Cas 60-832

Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11

Mandrake Holdings Ltd v Countrywide Assured GroudPlc [2005] EWCA Civ 840

Maxwell v Highway Hauliers Pty Ltd (2013) 45 WAR 296; [2013] WASCA 115

Moore v Scenic Tours Pty Ltd (2020) 268 CLR 326; [2020] HCA 17

Morrison v Jenkins (1949) 80 CLR 626

Moss v Sun Alliance Australia Ltd (1990) 55 SASR 145

Oakland Investments (Aus) Ltd v Certain Underwriters at Lloyd’s [2012] QSC 6; (2012) 17 ANZ Ins Cas 61-932

Palmer v Dolman [2005] NSWCA 361

President of India v Lips Maritime Corp [1988] AC 395

Russell Young Abalone Pty Ltd v Traders Prudent Insurance Co Ltd (1993) 7 ANZ Ins Cas 61-182

Sharma v Insurance Australia Ltd [2017] NSWCA 307

Sprung v Real Insurance (UK) Ltd [1999] 1 Lloyd’s IR 111

Tropicus Orchids Flowers and Foliage Pty Ltd v Territory Insurance Office (1998) 148 FLR 441

Versloot Dredging BV v HDI GerlingIndustrieVersicherung AG [2017] AC 1; [2016] UKSC 45

Vines v Australian Securities and Investments Commission (2007) 73 NSWLR 451; [2007] NSWCA 75

Zoneff v R (2000) 200 CLR 234; [2000] HCA 28

Category:

Principal judgment

Parties:

Kim Michelle Worth (Appellant)
HDI Global Specialty SE (formerly International Insurance Company of Hannover SE) (Respondent)

Representation:

Counsel:
T Castle SC and P Mann (Appellant)
S Donaldson SC and N Olsen (Respondent)

Solicitors:
LMI Legal (Appellant)
McInnes Wilson (Respondent)

File Number(s):

2020/112258

Publication restriction:

Nil

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Equity

Citation:

[2020] NSWSC 249

Date of Decision:

19 March 2020

Before:

Parker J

File Number(s):

2016/326625

HEADNOTE

[This headnote is not to be read as part of the judgment]

On 1 September 2015, the appellant’s home was substantially destroyed by fire. She also operated a childcare business from the ground floor of the two-level property.

The appellant spent the evening of 31 August 2015 caring for her elderly parents at their home. On that evening when she left her home she switched on an electric screen displaying pictures of Tahiti. She returned to the house at 9am and remained until 9:28am, during which time she did not switch off the Tahiti screen but did turn on a cooktop element on the kitchen stove to boil an egg. At 9:36am a passing driver telephoned the police and reported that smoke and flames could be seen coming from the windows on the first floor balcony of the house.

The forensic evidence established that there were two independent sources of ignition of the fire. The first was in or around the eastern end of the living room on the first floor and was responsible for all of the damage to the house. The second was on the cooktop in the kitchen, as a result of the element being left on and burning a 200-page ‘game guide’ book, part of which was found on the cooktop surface.

The house and business were insured under the respondent’s Home Based Business Property Insurance policy. The policy was for 12 months from 20 August 2015. The building was insured for $500,000, the contents for $80,000 and the business for 12 months of business interruption losses up to a limit of $132,000.

By a Deed of Release dated 16 December 2015, and whilst the cause of the fire remained under investigation, the respondent granted a “conditional indemnity”, under which it agreed to pay the appellant in accordance with the policy. In turn, she agreed to repay those moneys in the event that a “police force” found that she had deliberately caused the fire. The respondent made preliminary payments totalling $98,000. On 23 September 2016, the respondent advised the appellant that it denied her claim, relying in part on a police forensic report concluding that the fire had been deliberately lit.

The appellant commenced proceedings in November 2016. She sought the following: the costs of reinstating her home; 12 months of business interruption losses; damages for consequential loss of business revenue for the period after the expiry of that 12 months and continuing; and damages for personal inconvenience arising from the respondent’s failure to meet her claim and alleged breaches of its obligation to act with utmost good faith under Insurance Contracts Act 1984 (Cth), s 14(1). Those claims as formulated were made under the Deed of Release as distinct from the insurance policy. The respondent by cross-claim sought to recover the payments made to the appellant and damages for her breach of the duty of utmost good faith in making an allegedly false claim.

The primary judge dismissed the appellant’s claims, finding that she deliberately lit the fires in the kitchen and the living room. On 17 April 2020, judgment was entered for the respondent on its cross-claim for $194,505 plus interest.

The principal issues in the appeal were:

(i) whether the primary judge erred in finding that the appellant had deliberately lit the kitchen fire;

(ii) whether, having made that finding, the primary judge erred in finding that the appellant had deliberately lit the living room fire;

(iii) in the event that those questions are answered in the affirmative, the relief to which the appellant was entitled.

The Court held (per Macfarlan and McCallum JJA, Meagher JA dissenting), allowing the appeal, that the primary judge erred in concluding that the fire had been deliberately lit.

In relation to issue (i):

1. Per Macfarlan and McCallum JJA: The primary judge failed to exclude the hypothesis identified by the appellant’s expert as to how the kitchen fire may have started without human intervention as a reasonable possibility. The respondent’s hypothesis rested on “impermissible speculation”: at [3] (Macfarlan JA); [235], [270]-[271], [275] (McCallum JA).

2. Per Meagher JA, dissenting: The evidence disclosed no plausible explanation for how the game guide could have ended up positioned on the cooktop without human intervention: at [92] (Meagher JA).

In relation to issue (ii):

3. Per Macfarlan and McCallum JJA: The primary judge erred in rejecting as fanciful the possibility that an electrical fire originating in the Tahiti screen caused the living room fire. The evidence did not allow any reliable inference to be drawn about the materials from which the screen was made, how it might have responded to electrical malfunction, or the manner in which it might have fallen: at [4] (Macfarlan JA); [277]-[279] (McCallum J).

4. Per Meagher JA, dissenting: The possibility that the Tahiti screen had caused the living room fire was “fanciful” and was apt to be disregarded: at [67] (Meagher JA).

In relation to issue (iii) (relief) (per Meagher JA, Macfarlan and McCallum JJA agreeing):

5. The amount payable to the appellant for property damage was to be calculated on an indemnity basis rather than a reinstatement basis. The appellant failed to commence reinstatement “with reasonable despatch”. That position under the policy was not altered by the existence of the Deed of Release, under which the promise was to make payments “in accordance with the Policy” including the “basis of settlement” proviso: at [6] (Macfarlan JA), [171]-[176] (Meagher JA), [207] (McCallum JA).

CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2, applied.

6. Under the policy the appellant was entitled to 12 months of business interruption losses. Her claim for such losses after that date was not to an indemnity under the contract but to damages for consequential losses arising from the insurer’s breach of its promise to indemnify. That claim was not maintainable under the policy because, according to the analysis in Globe Church Incorporated v Allianz Australia Insurance Ltd (2019) 99 NSWLR 470; [2019] NSWCA 27, it was a claim to damages for late payment of damages. Nor was it maintainable under the Deed of Release, which did not extinguish or supersede her claims under the policy. Accordingly, that Deed did not substitute any promise to pay money for the appellant’s claims to unliquidated damages for breach of the insurer’s obligation under the policy: at [6] (Macfarlan JA), [179]-[191], [192]-[195] (Meagher JA), [207] (McCallum JA).

Globe Church Incorporated v Allianz Australia Insurance Ltd (2019) 99 NSWLR 470; [2019] NSWCA 27, applied; Brescia Furniture Pty Ltd v QBE Insurance (Australia) Ltd (2007) 14 ANZ Ins Cas 61-740; [2007] NSWSC 598; Maxwell v Highway Hauliers Pty Ltd (2013) 45 WAR 296; [2013] WASCA 115; Hungerfords v Walker (1989) 171 CLR 125, considered.

7. The appellant was not entitled to damages for inconvenience and distress caused by the respondent’s failure to indemnify for the same reasons as her consequential business loss claim. Nor was this a case in which the exception to the non-recovery of contractual damages for anxiety, distress and disappointment was engaged, as her losses did not involve mental suffering “directly related to” physical inconvenience: at [6] (Macfarlan JA), [200]-[203] (Meagher JA), [207] (McCallum JA).

Baltic Shipping Company v Dillon (1993) 176 CLR 344, applied; Moore v Scenic Tours Pty Ltd (2020) 377 CLR 209; [2020] HCA 17; Archibald v Powlett (2017) 53 VR 645; [2017] VSCA 259, considered.

Judgment

1. MACFARLAN JA: I have had the advantage of reading in draft the thorough judgments of Meagher JA and McCallum JA on this difficult appeal. I agree with the orders proposed by McCallum JA and with her Honour’s reasons. I add the following observations.

2. For good reason, both their Honours focus on the expert evidence. Unless that evidence is concluded to provide strong support for the respondent insurer’s case, that case must fail as the remaining evidence falls well short of making out a case of arson on the part of Ms Worth. As Meagher JA accepts, Ms Worth appears to have conducted “a happy and well-provisioned childcare business” from the home in which she lived with her 12 year old son ([139]). Moreover the evidence of a financial motive of Ms Worth to destroy her home could not be described as strong (see [135]).

3. As to the expert evidence, I agree with McCallum JA that the hypothesis identified by Ms Worth’s expert, Mr Gardner, as to how the kitchen fire may have started without human intervention was not excluded as a reasonable possibility ([271]). Moreover the contrary theory leaves unexplained a number of puzzling questions identified by McCallum JA at [272]-[274], including: if Ms Worth intended to commit arson, why would she have placed the game guide on only half of the activated cooking element and not on the whole; and if she had had that intent, why would she have moved the smouldering game guide off the hot element but left it still partially on the cooktop, and proceeded to start a fire elsewhere in the house (that is, in the living room).

4. As to the other topic of expert evidence, I agree with McCallum JA that if, as was the case, the occurrence of an electrical fire in the Tahiti wall screen was not excluded, the possibility of the living room fire occurring without human intervention could not be excluded without reliance on impermissible conjecture ([280]).

5. In these circumstances, I do not consider that the evidence gave rise to “a reasonable and definite inference” that Ms Worth intentionally caused the fire that destroyed her home (Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5). The appeal should therefore be allowed.

6. On the issues on the appeal concerning damages, I agree with Meagher JA.

7. MEAGHER JA: On 1 September 2015 the appellant Ms Worth’s home, from which she also operated a childcare business, was destroyed by fire. She made a claim upon her property insurance, which was rejected on the basis that she had deliberately lit the fire. That defence was upheld (Worth v International Insurance Company of Hannover SE [2020] NSWSC 249). Ms Worth appeals from the orders giving effect to that judgment.

8. The home, in Tweed Heads, was substantially destroyed by a fire on the morning of Tuesday 1 September 2015. Ms Worth lived in that two level house with her son Joshua, then aged 12. She operated the childcare business from the ground floor.

9. The property and business were insured by the respondent insurer, Interhannover, under a Home Based Business Property Insurance policy – the building for $500,000, contents for $80,000, and the business for a 12 month period during which its results were affected, up to a limit of $132,000.

10. As at December 2015, and as between the parties, the cause of the fire remained “to be determined”. By a Deed of Release dated 16 December 2015, the insurer granted a “conditional indemnity” to Ms Worth, the relevant condition requiring repayment of any moneys paid in the event of a finding by a “police force” that she had deliberately caused the fire. Preliminary payments totalling about $98,000 were made. On 23 September 2016, Interhannover formally advised Ms Worth that it denied her claim, relying in part on a police forensic report that the fire had been deliberately lit.

11. The appellant commenced the underlying proceedings in November 2016. As finally formulated her claim was for the cost of reinstating the home ($495,000, rather than its “indemnity basis” value of $400,000), for contents at an agreed value of $80,000, and for business interruption loss. In this Court the business interruption claim is to an amount of $54,292, or alternatively $45,708. All of these claims were made under the Deed of Release, which is said to have “superseded” the policy and to constitute an enforceable agreement that the insurer would make payments in accordance with the terms of the policy.

12. Two further claims were made. Each was for breach of the insurer’s statutory obligation to act with the utmost good faith (Insurance Contracts Act 1984 (Cth), s 13) and alternatively for breach of its obligation to indemnify within a reasonable time, which it is agreed would have resulted in the rebuilding of the home and place of business within 9 months. The first of these claims was for consequential loss, being the business revenue that would have been received had the business operated during the period of delay, said to be continuing. The second was for “personal inconvenience” suffered by Ms Worth. An amount of $50,000 was claimed as general damages for that inconvenience and its consequences.

13. The primary judge (Parker J) dismissed Ms Worth’s claim, finding that she deliberately lit the fire. Having done so, on 17 April 2020 his Honour entered judgment for Interhannover for $194,505 plus interest on its cross-claim to recover payments made to Ms Worth under the policy and Deed of Release, and by way of damages, additional expenses incurred in investigating her claim prior to the commencement of proceedings.

The circumstances of the fire

14. On the evening before the fire Ms Worth and her son stayed with her parents, who lived nearby. They had just returned from an ocean cruise and were unwell. Ms Worth checked on her parents’ condition regularly throughout the night of 31 August. Prior to leaving her home on that evening, she had turned on a “portable radio” in the dining room and an electronic “Tahiti picture” screen, which was on the north-facing wall of the stairwell from the ground floor to the living room (the Tahiti screen).

15. By the early morning, her father’s condition had worsened and an ambulance was called. It arrived at about 8:15 am and took him to Tweed Heads Hospital. Shortly afterwards, she drove her son to school, arriving at about 8:25 am. She then delivered crockery, tablecloths, sandwiches and other “party supplies” to the home of a friend of her mother who was having her 80^th birthday that day. Having done so, Ms Worth drove home, arriving at about 9 am.

16. She remained in the house between 9 and 9:28 am, and then left to visit her father in hospital. She did not turn off the radio or picture screen. She did, however, turn on a hotplate on the kitchen stove because she had decided to boil an egg. At about 9:36 am, eight or so minutes after she had left the house, a passing driver telephoned the police to report that smoke and flames were coming from the area of or above the windows which looked onto the first floor balcony on the eastern and street side of the house. Below is a plan of the first floor area of the home.

17. The balcony is shown adjacent to the living room. The position of the kitchen cooktop is indicated by four small circles above the word “Kitchen”. The configuration of the living room, and in particular the position of the “Tahiti picture”, is shown in the sketch reproduced in [34] below.

18. The expert evidence was held to establish that the point of origin of the fire was on or near the eastern end of the L-shaped lounge in the living area on the first floor, where “there was no electrical source” (Judgment [291]). The primary judge also found that a separate fire had occurred on the cooktop as a result of the leftmost cooktop element, which had been left on, burning the underside of a ‘Lego Marvel Superheroes’ game guide lying directly on top of the element. A photograph (E150, being part of exhibit E) of an undamaged copy of that game guide (back cover facing up) beside the mostly charred remaining part of the game book recovered from the cooktop surface appears below. Also below is a photograph (E64) of the cooktop surface, taken on 2 September 2015 before it was cleaned, which shows the charred remains of the game book in the position in which it was first found, partly on the left side of the cooktop surface (but not on any part of the element). Photo E74 (at [75] below) is a close up picture of the remains of the game guide in that position.

Photo E150

Photo E64

19. The back cover as shown in photo E150 is face down on the cooktop surface in photos E64 and E74. The facing page is page 101, as shown in photo E158 below, which shows the remains of the game guide facing up and beside an undamaged copy of the book.

Photo E158

The balance of the book – the cover page through to page 100 – is not present in photos E64 and E74, which were taken by Mr Forbes.

20. An understanding of the issues concerning the remains of the game guide found in the corner of the cooktop is assisted at this point by reference to the primary judge’s reasons at J [141]-[144]:

As already mentioned, the charred remains of the game guide which were found on the side of the cooktop were missing the first one hundred pages and the front cover. The back of the game guide had semi-circular burn marks which corresponded to the shape of the cooktop, but the book itself was found resting partially on and partially off the left hand side of the cooktop so that the back was not actually on the element.

The tests which were done at Londonderry in October 2015 [the experiments were conducted at the NSW Fire and Rescue Fire Research Facility at Londonderry by Mr Forbes and Detective Wilcox] were directed towards understanding how this could have happened. One hypothesis was that the game guide had been left open with the first one hundred pages draped over the top of the cooktop; the thought was that those pages could have been ignited and wholly consumed, and the roughly semi-circular burn mark could have been created by fire spreading from the front pages to the bottom of the back of the game guide.

But the test results did not support this hypothesis. Opening the game guide with the first one hundred pages over the cooktop did not result in the complete destruction of the first hundred pages or the semi-circular burn mark on the back. The only way in which that burn mark could be achieved was by placing the back of the game guide directly on the element.

As a result, both Officer Forbes and Mr Nash concluded that the first hundred pages had been torn off the game guide; the rest of the book had been placed on the cooktop on the element; and it had later been moved off to one side. This obviously could only have been the result of human intervention.

21. Ultimately, the primary judge held that there was “no credible explanation for the kitchen fire apart from human intervention”, that it was “impossible to see how the game guide could innocently have ended up on the cooktop element” and that in the absence of any evidence from Ms Worth as to how the game guide came to be on the cooktop with the element turned on, “the compelling scientific evidence of human intervention” was unanswered, in circumstances where the only person who could possibly have intervened was Ms Worth (J [293], [294], [296]).

22. Although the cooktop fire did not cause the fire in the living room, which spread throughout the house (including to the kitchen), the primary judge held that Ms Worth had deliberately started the fire in the living room. His Honour’s reasoning is dealt with in more detail below. The objective circumstances on which he necessarily relied included: that there was no realistic suggestion that that fire could have been lit by a third party intruder (J [92]); that flames and smoke from the fire were first seen and reported to police within 7 or 8 minutes of Ms Worth leaving the house (J [290]); that the fire broke out in the living room in the area of the north-south part of the lounge where there was no electrical source (J [291]); that Ms Worth had placed the game guide on the energised cooktop element; that at some later stage she had moved the game guide to the side of the cooktop, where it was later found (J [143], [144], [164]); and that in doing so Ms Worth must have been attempting to start a fire on the cooktop element. The exact means by which she started the living room fire, on or under the lounge, was not the subject of specific findings.

Grounds of appeal

23. Ms Worth appeals from the judgment dismissing her claim and the judgment for the respondent on its cross-claim. The conclusion that she deliberately lit the fire is challenged by grounds 1 to 9. Grounds 1, 2 and 8 are directed to the primary judge’s reasoning to that conclusion, taking account of the relevant circumstances as found. It is contended that the ultimate conclusion was “glaringly improbable” in circumstances which included: that attempting to use the cooktop and game guide to start a fire in the kitchen was an extraordinarily ineffective way of going about it; that there was no evidence of Ms Worth having engaged in any preparation or planning for the fire; and that it was unlikely that someone in Ms Worth’s position would have wished to burn down the place where she lived and carried on her business.

24. Grounds 3 and 4 for the most part concern the findings as to the possible cause or causes of the living room fire, and ground 6 the circumstances of the fire in the kitchen. Grounds 5 and 7 are directed to findings as to the appellant’s motive and conduct immediately after she left the house on the day of the fire. Ground 9 is directed to the findings as to the appellant’s credibility. Grounds 10 and 11 press the appellant’s claims to “damages” for breach of the Deed of Release. Those claims are to an indemnity for the property damage and business interruption loss and to damages for consequential loss and inconvenience. Ground 12 challenges the judgment on the cross-claim, and depends on the outcome of grounds 1 to 9.

General principles

25. The insurer has the onus of proving that Ms Worth deliberately lit the fire on the balance of probabilities, but taking into account the matters required to be considered by Evidence Act 1995 (NSW), s 140(2), including the gravity of the matters alleged. Where, as here, that question depends on the consideration of circumstantial evidence, the approach to be taken in a civil case was described in Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5 (Dixon, Williams, Webb, Fullagar and Kitto JJ) as follows:

The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypothesis consistence with innocence, while in the latter you need only circumstances raising a more probable inference in favour of what is alleged. In questions of this sort, where direct proof is not available, it is enough if the circumstances appearing in the evidence give rise to a reasonable and definite inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture [citations omitted]. But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then, though the conclusion may fall short of certainty, it is not to be regarded as a mere conjecture or surmise.

26. In Palmer v Dolman [2005] NSWCA 361 at [41], Ipp JA (with the agreement of Tobias and Basten JJA) described the following principles as having “become well-established in determining, in a civil case, whether circumstantial evidence leads to an inference of fraud”:

(a) The jury [i.e. fact-finder] must consider “the weight which is to be given to the united force of all the circumstances put together” [Belhaven & Stenton Peerage (1875) 1 App Cas 278 at 279 (Lord Cairns), quoted with approval in Chamberlain v R (No 2) (1984) 153 CLR 521 at 535 (Gibbs CJ and Mason J)].

(b) The onus of proof is only to be applied at the final stage of the reasoning process: “[i]t is erroneous to divide the process into stages and, at each stage, apply some particular standard of proof. To do so destroys the integrity of [a] circumstantial case” [Transport Industries Insurance Co Ltd v Longmuir [1997] 1 VR 125 at 129 (Winneke P)].

(c) The inference drawn from the proved facts must be weighed against realistic possibilities as distinct from possibilities that might be regarded as fanciful.

(d) Where the competing possibilities are of equal likelihood, or the choice between them can only be resolved by conjecture, the allegation is not proved: Bradshaw.

27. Approaching the insurer’s circumstantial evidence case in this way, it is necessary first to address the challenges to the findings with respect to the source and origin of the living room and cooktop fires (other than his Honour’s ultimate conclusion as to the former); Ms Worth’s motive and financial circumstances; “psychological” considerations bearing on the likelihood that she would have started the fire; and her conduct after leaving the house on 1 September 2015. Finally, I will address the overarching grounds 1 and 8, and in doing so also deal with the remaining grounds 2, 6(a) and 9(a).

Overview of finding that the appellant deliberately lit the fire

28. The primary judge’s reasons set out much that is not controversial. That part of the reasons includes a description of the property (J [17]-[21]) and the time sequence in which the fire occurred (J [23]-[35]), a description of the fire damage (J [36]-[53]), a summary of the investigations undertaken by Fire and Rescue NSW (FRNSW) and the NSW Police (J [54]-[60]), a statement of the factual issues with respect to the arson defence (J [92]-[98]), and a summary of the course of the oral evidence given at trial and issues as to the origin of the fire (J [108]-[110]). What follows assumes a familiarity with those parts of his Honour’s reasons.

29. As already noted, the primary judge found that there were two separate and independent areas of ignition. The effective fire originated in or near the lounge area of the living room and initially developed below an intact ceiling. Following “flashover” in that living room – the point at which a room reaches the autoignition temperature of most or all flammable material and “a fire in the room” becomes “a room on fire” – the ceiling collapsed, allowing the fire to spread into the roof and from there into other areas, including the kitchen. It did not, however, cause the fire on the cooktop. That was the result of an energised cooktop element causing flames and the burning of part of the game guide on the cooktop. His Honour found that there was no plausible explanation in the evidence for how that book ended up on the cooktop element without human intervention.

30. Ms Worth’s evidence was that she had turned the hotplate on after she returned to the house, planning to boil herself an egg. She had then decided not to do so. As to the game guide, she did not remember seeing it when she was in the kitchen. At the same time she accepted that it could have been with papers she kept on the bench top to the left of the cooktop. She denied ever putting the book on the cooktop and could not recall having seen it in the kitchen on or before 1 September 2015.

31. What remained significantly controversial was how the main fire in the living room was started and whether the cooktop fire was deliberately lit. That question in turn directed attention to how the game guide (or part of it) came to be on the cooktop element, and whether at some stage it was moved, before or during the fire.

32. The expert witnesses retained by the parties were Mr Gardner for Ms Worth and Mr Nash for Interhannover. Neither of those witnesses attended the scene of the fire on or shortly after 1 September 2015. Oral evidence as to the circumstances of the fire was given in the insurer’s case by Ms Rampling, a police crime scene officer, and Mr Forbes, a senior officer of FRNSW. Affidavit evidence of Mr Perrin, the FRNSW officer in charge who attended the fire, and of Senior Constable Wilcox, one of the joint leaders of the police investigation into the fire, was also read. On 2 September 2015, police crime scene and FRNSW officers inspected the fire damaged premises. On that occasion a number of photographs were taken by Mr Forbes and Ms Rampling. Those photographs, as well as photographs taken during the course of the tests undertaken at Londonderry (J [62], [142]) and miscellaneous other photographs, became exhibit E.

The living room fire (grounds 3(a)-(c) and 4(a)-(d))

The potential sources of ignition

33. It was ultimately accepted by Messrs Forbes, Nash and Gardner that the living room fire commenced in or near the lounge area on the eastern side of that room, below an intact ceiling (J [113], [114]). This fire was responsible for all of the fire damage to the appellant’s home. The critical question is what can be said about its probable cause if the fact of the cooktop fire is put to one side.

34. The configuration of the living room immediately before the fire appears from the following sketch, which was prepared by Ms Worth and is consistent with her other evidence. The sketch plan runs south to north from top to bottom, so that the eastern side of the house (and balcony) is on the left. The position of the Tahiti screen is shown on the southern wall of the internal stairwell and a cane and wooden shelving unit, which had audio speakers on the floor at each end of the unit, is shown against the eastern sliding door leading to the balcony and facing the back of the lounge:

35. The photograph below, taken a few years before the fire and facing in a northeast direction, shows the lounge, the “television on an entertainment unit” along the north wall, and the top of the internal stairwell (J [36]-[37]). Neither the cane and wooden shelving unit behind the lounge nor the Tahiti screen can be seen.

36. The appellant’s case described the two potential electrical sources of the living room fire as being the set of speakers situated on the floor on either side of the low shelving unit on the eastern side of the lounge area and the “plasma or ... LCD screen” mounted on the southern wall above the stairs, which displayed a “moving picture of a Tahiti beach scene with lights” when turned on. As has been mentioned, the appellant’s unchallenged evidence was that she turned the Tahiti screen and portable radio (in the dining room) on when she left the house on the evening before, expecting to return later that night, and that it remained on when she left the house on the morning of the fire. She did not recall any other occasion on which the screen had been left on overnight.

The findings of the primary judge

37. The primary judge described the evidence for the view of Mr Forbes and Ms Rampling, that the fire originated “on or near the [eastern] north-south part of the lounge”, as “strong” (J [139], [291]). But his Honour was not prepared to reject Mr Nash’s opinion that the fire might have had a point of origin anywhere “generally within the eastern section of the lounge room” (J [120]). Accordingly, he found that an electrical fire in the speakers was a “possible” explanation for the living room fire, considered alone, albeit one for which there was no affirmative evidence (J [140]). He rejected the theory that the fire was caused by an electrical fire in the Tahiti screen as depending on possibilities “so remote and apparently improbable as to be fanciful” (J [138]).

38. The appellant accepts that the primary judge was entitled to disregard “fanciful” possibilities when considering whether to draw an inference from all of the circumstances that the fire was deliberately started: see Sharma v Insurance Australia Ltd [2017] NSWCA 307 at [66]. However, she contends that his Honour erred in favouring the view of Mr Forbes and Ms Rampling as to the point of origin of the living room fire, as well as in failing to find that the Tahiti screen was a “realistic possible cause” of the fire (grounds 3(a), (c), 4(b), (c) and (d)). She also submits that the fact the living room fire reached “flashover” at 9.46 am suggests the fire began well after she had left the house, at about 9.28 am, making it unlikely that she could have started it (grounds 3(b), 4(a)).

The point of origin of the fire

39. Mr Gardner first inspected the fire scene some three years after the fire, by which point, in his words, “there was no actual evidence of an area of origin”.

40. On the other hand, Mr Forbes and Ms Rampling inspected the property on 2 September 2015, the day after the fire, and formed the view that the point of origin of the fire was in the “north-south part” of the lounge (or sofa), immediately to the west of (to the viewer, in front of) marker “D” in the following photograph (E104) taken by Mr Forbes after the removal of debris on that day:

Photo E104

This photograph also shows the heavily charred remains of the southern part of the lounge (running east-west). The remains of the speakers are the small circular objects immediately to the right of marker “D” and on the opposite side of the remains of the stereo system to the left of that marker.

41. Mr Forbes and Ms Rampling referred inter alia to the following features of the fire scene as evidence for their favoured point of origin: (1) there was “a ‘V’ pattern of burning” on the northern wall “with its base under the middle of the window”, shown in the photograph in [35] above; (2) the timber entertainment unit along that wall, and to the left of that window as shown in that photograph, had been damaged most extensively at its end closest to that window; (3) there were “clean burn” patterns on the underside of the metal roof over the eastern half of the lounge room; (4) the damage to the lounge was most severe at its eastern end of the lounge; (5) the floating timber floorboards were “heavily charred and completely consumed” towards the centre of the room in an area bounded on its northern and eastern edges by markers “C” and “D” respectively; (6) the floorboards were intact under “the stereo system which incorporated the speakers”, suggesting that they were not the source of the fire; (7) the distribution of fire damage to the lounge suggested “a direction of fire travel from north to south” across the eastern part of the lounge; and (8) the floorboards under the remains of the lounge nearest to the stairwell also remained intact, “which indicated that these chairs had not been burning the longest time”. At the time they examined the fire scene, neither of Mr Forbes nor Ms Rampling knew of the Tahiti screen, which it seems was completely destroyed by the fire.

42. Mr Nash inspected the fire scene on 4 September 2015 and prepared an initial report dated 10 September 2015. He concluded that the fire “had originated in the eastern section of the lounge room, including the internal stairwell” but could not identify a more precise point of origin within that area, because only a “limited scene examination” was “possible on the day of [his] inspection” and the lounge room “had been significantly disturbed during a previous examination”. Unlike Mr Forbes and Ms Rampling, Mr Nash had been informed before his inspection of the presence of the “stereo system” along the eastern side of the room and of the Tahiti screen on the southern wall above the stairwell. Based on his conclusion about the point of origin, he regarded an “electrical malfunction” in either device as a “possible accidental cause of ignition”. By the time of his second report dated 30 August 2016, Mr Nash had excluded an electrical fault in either device as a possible cause of the fire because of his views about the cooktop fire. However, as he accepted in cross-examination at trial, he continued to regard an electrical fire in the speakers or the Tahiti screen as possible causes of the living room fire, if attention was confined to that fire alone.

43. In his second report, Mr Nash explained that he did not accept the conclusion of Mr Forbes and Ms Rampling as to the fire’s point of origin because:

... the fire damage was too severe within the lounge room for me to reliably conclude such a localised point of fire origin. The fuel load provided by the lounge chairs and the ventilation provided by the internal stairs and the balcony sliding doors upon failure would have significantly influenced the degree of post-flashover damage sustained within the lounge room. Hence, the localised area of greatest damage on the floor did not necessarily represent the area of fire origin.

(emphasis added)

44. He gave essentially the same evidence at trial, explaining that there was “a substantial fuel load in the lounge chair ... that would dominate the damage that’s been sustained” and that:

You can have a small fire start reasonably remote, like several metres away from the area where the fire develops from predominantly, but you won’t necessarily get physical evidence remaining to allow you to come back to the original origin.

45. When the gist of Mr Nash’s view was put to Ms Rampling, she accepted that the location of the most severe and (by height) the lowest fire damage might be the location of the greatest fuel load, or reflect where timbers had fallen during the fire. But she did not abandon her view as to the likely point of origin of the fire:

Q. [A] fire may originate in one point, but because of flashover and falling timbers, the intensity of the fire may actually be in a different point to the point of origin?

A. Yes, but generally the, the amount of time it takes to reach that flashover, the, the area of origin [of] the fire will have been continually burning in that location, which is generally why the, the area of the most severe damage tends to point sort of towards that area of origin.

46. Mr Nash’s opinion is plausible and, as Ms Rampling’s evidence accepts, it cannot be conclusively rejected: as the primary judge put it, his “opinion was not challenged and there is nothing in the evidence to shake it” (J [139]). However, Mr Nash’s emphasis on the “substantial fuel load” provided by the lounge does not explain the pattern of damage to the lounge and the floorboards underneath it, which suggested that the southern part of the lounge (running east-west) was not “burning [for] the longest time” and that the fire spread “from north to south” along the eastern part of the lounge, in the direction of, rather than from, the stairwell. Ms Rampling accepted that falling timber could theoretically have provided an additional fuel load, but there was no evidence as to the likelihood of that possibility.

47. Dealing specifically with the speakers, in his evidence at trial Mr Forbes maintained (see above at [41]) that the fact the floorboards underneath them had not been consumed by the fire suggested they were not its cause. Mr Nash’s response in his second report was that “the stereo system” appeared from his inspection to have occupied “a level of the cabinet that was well above floor level”, and that the floorboards would accordingly “be expected to survive a fire” in the stereo system. This response is directed only to the stereo, and not the speakers, which the appellant contends were a realistic possible source of the fire. The speakers were located on the floor, at the base of a “cane and wood unit with two shelves” containing the stereo (apparently on the upper shelf). On the hypothesis that the living room fire began in the speakers, the absence of serious damage to the floorboards under and immediately adjacent to that shelving unit remains unexplained.

48. For these reasons (which principally address ground 4(b)), as well as those which follow in relation to the Tahiti screen, the primary judge was right to find that the evidence “favours” the view of Mr Forbes and Ms Rampling as to the likely point of origin of the fire (J [291]). That likely point of origin did not contain any electrical source. However, as his Honour also found, it is “not possible” to be certain that the fire did not start within the larger area of origin identified by Mr Nash, which included the location of the speakers and the internal stairwell (J [139]-[140]). (Contrary to what is suggested by ground 4(b), there is no inconsistency between his Honour’s findings at J [139]-[140] and [291].) An electrical fire starting in the speakers therefore remains a possible cause of the fire, but not one for which the evidence provides any affirmative support.

49. As those findings suggest, and as Mr Nash opined, there remains the possibility that the fire began in the internal stairwell. The Tahiti screen was the only possible source of fire in that area of the house.

The Tahiti screen

50. Ms Worth purchased the Tahiti screen from a pop-up store in Tweed Heads some time between 2008 and 2010, and had it mounted on the southern wall above the internal stairwell by an electrician. In photograph E47, part of the mounting and cabling, together with some surviving plasterboard – described by counsel for Ms Worth as in the shape of a “map of India with Sri Lanka at the bottom” – can be seen in the location formerly occupied by the screen itself:

Photo E47

51. Two theories, at least partly distinct, were advanced as to how the Tahiti screen might have caused a fire on or under the lounge in the eastern end of the living room. (Counsel for Ms Worth put forward a third theory in cross-examining Mr Forbes, namely that flames coming from the mounted Tahiti screen produced a fire in the ceiling. This theory is inconsistent with the expert consensus that the fire developed in the living room below an intact ceiling.)

52. The first of these theories, put forward by Mr Gardner, was that an electrical fire in the device produced “burning plastic embers” which floated across the stairwell and into the living room before falling and setting fire to the lounge. This theory received no support from Mr Nash, as the primary judge observed at J [137], and it was contradicted by Mr Forbes, who stated, it must be thought uncontroversially, that “burning plastic from any electrical device would melt and drip”.

53. The second, put forward by Mr Nash, was that the device ignited, fell from its mounting on the southern wall of the stairwell to rest against the lower wall on the northern side of that stairwell, and there produced flames of roughly a metre in height which crept up the stairwell wall to ignite the southern side of the lounge. Mr Nash described this as a possibility “that I can’t eliminate”. However, he was “not saying that’s likely to have happened”, or that it was positively supported by the state of the fire scene. In this respect, as he volunteered, to say that the fire scene was “consistent [with the fire having started there] is probably too positive a term”.

54. The appellant contends that the primary judge erred in excluding both of these possibilities from consideration as being “fanciful” (ground 4(c)), although her submissions deal primarily with the second. She submits that theory is positively supported by the evidence, particularly the damage to the stairwell. (It should be noted immediately that Mr Nash’s opinion did not go anywhere near so far.) Three aspects of the evidence and the primary judge’s reasons are relevant to the Tahiti screen theory: first, the state of the wall behind the screen; secondly, the likelihood of the screen falling to rest against the opposite wall of the stairwell rather than down the stairs; and thirdly, the fire damage to the stairwell, or the lack thereof. Each is addressed in turn.

55. As can be seen in photograph E47, the surviving plasterboard and cornice behind and immediately above where the screen was mounted did not show extensive fire damage. However, that is not itself surprising. Mr Nash explained that small marks or patterns produced by a fire in the screen might well have been obliterated in the later stages of the living room fire, during which there was “a substantial fire and hot gases at ceiling level and down in the upper sections of the walls in that whole area”. This appears to presume that the screen fell from its mounting fairly quickly after catching fire, as parts of its plastic softened or melted. Both Mr Nash and Mr Gardner suggested that could well have been the case, depending on how the screen was attached to the wall.

56. None of that raises a problem for Mr Nash’s theory. It does seem to raise a further difficulty for Mr Gardner’s, which requires the screen to have remained mounted while emitting burning plastic embers of sufficient size and force to reach and ignite the lounge but to have fallen from its mounting before doing substantial damage to the plasterboard and cornice.

57. As the primary judge observed at J [135], Mr Nash’s theory “required the picture unit to have come to rest on the northern side of the stairs close enough to the top that flames emitted from the unit could reach the lounge”. Treating the likelihood of that event as a question for “the science of mechanics” (in relatively simple applications a matter of “general knowledge”) rather than “fire expertise” (J [136]), his Honour stated that (J [132]):

I must say I found this somewhat implausible. ... It seemed to me that a picture unit falling from that height would have fallen down the stairs rather than staying where it fell; and even if it somehow did come to rest on the staircase it would have come to rest on the southern rather than the northern side of the stairwell.

58. The appellant’s criticism of this reasoning as involving “impermissible speculation” (ground 4(d)) about matters the subject of unchallenged evidence is not justified. Mr Nash’s evidence was tentatively expressed and acknowledged the possibility, suggested to him by both counsel for the respondent and the primary judge, that the screen was likely to have fallen all the way down the stairs. It remained for his Honour to form a view about the relative likelihood of the relevant possibilities.

59. As can be seen from photograph E47 and the sketch plan at [34] above, the Tahiti screen was mounted at a significant height roughly above the midpoint of the staircase. Accepting, as Mr Nash suggested, that the falling screen could have struck the southern balustrade and been deflected towards the northern side of the stairwell, it does not appear likely that the screen would then have come immediately to rest.

60. When asked whether the screen was not more likely to “have bounced down the stairs”, Mr Nash emphasised that the screen was “not a television” and said that he was not sure how it would behave. Mr Nash appears to have proceeded on the wrong assumption that the Tahiti screen was “just a photograph with a light mechanism ... which causes the appearance of the picture to move” and which “could be largely plastic; it could be largely paper with a timber frame” (cf J [133]). For that reason he was unsure whether the screen was likely to bounce down the stairs or “melt and stay largely in situ and just drop down to the ground”. (The second theory, of course, depends on the screen staying largely in situ but being deflected by the southern balustrade to rest against the opposite wall.) In fact, the Tahiti screen was, as Ms Worth described it, a plasma or LCD screen akin to a television, in other words what Mr Nash thought it was not.

61. Most of the balustrade along the top of the northern side of the stairwell was completely incinerated. But the bases of a few of the smaller balusters remained intact, to a height of roughly 200mm above the floor of the living room, and the larger and westernmost baluster was charred but entirely intact. That is not at all inconsistent with the view of Mr Forbes and Ms Rampling that the fire began in the north-south area of the lounge. Indeed, that the bases of several of those balusters survived flashover and the incineration of the lounge might be thought to suggest that the fire did not begin by creeping up the northern wall of the stairwell, through the balustrade, to the lounge.

62. Turning to the damage to the stairwell itself, the damage to the plasterboard on the northern wall of the stairwell, where (ex hypothesi) the screen fell to rest, was not extensive. As photograph E263 below shows, the “paint [was] burnt off and ... the plasterboard [was] thermally degraded”:

Photo E263

63. When asked whether that damage was consistent with a fire producing flames high enough to set the lounge alight, Mr Nash noted that he did not suggest it was “likely to have happened”. The stairwell treads themselves suffered only minimal damage. Although the northern face of the balustrade on the southern side of the stairwell was blackened significantly by some combination of charring and soot deposition, the theory is that the screen fell to rest against the northern wall of the stairwell. The extent of the damage to the southern balustrade was explained by Ms Rampling as due to “radiant heat and fire” resulting from a fire starting in the centre of the living room and burning material falling from the ceiling and roof cavity.

64. The damage to the stairwell does not itself exclude the Tahiti screen theory. It remains possible, though it would seem not very likely, that the degradation of the plasterboard on the northern wall of the stairwell was the result of an intense but brief fire in the Tahiti screen which produced roughly metre-high flames and set fire to the back of the lounge but died out before doing any further damage. But the damage to the stairwell is quite naturally explained by the effects of flashover and the collapse of the ceiling over the living room.

65. There remains one further matter, which is the subject of ground 3(c). The smoke first observed by a passing driver at about 9:35 am was “predominantly black in colour”. The appellant submits that “electronic monitors produce black smoke on ignition, and that the smoke corresponded to the location in the house of the Tahiti Screen” (footnotes omitted). The evidence that fires in flat screen monitors produce black smoke was given by Mr Forbes, who also emphasised that “[a]ll fires produce black smoke, generally”. That statement was neither challenged nor contradicted by other evidence. What could be proven by the approximate location of the smoke, in circumstances where the likely point of origin was only a few metres from the screen, is not clear.

66. The appellant does not seriously contend for the first theory, which is fanciful having regard to Mr Forbes’ evidence. The second, Mr Nash’s theory, requires the screen to have fallen from a significant height but come immediately to rest against the northern wall of the stairwell, and to have produced flames tall enough to set the northern balustrade structure and the lounge alight but without consuming any substantial fuel source or causing extensive damage to the northern wall. It is also inconsistent with the pattern of damage to the lounge and the floorboards under it, which suggests (but does not conclusively prove) that the fire burnt the lounge from north to south.

67. In the circumstances, the possibility that the Tahiti screen was the cause of the fire was not “realistic” and “might be regarded as fanciful”: Sharma at [66], citing Palmer v Dolman [2005] NSWCA 361 at [41]. In my opinion the primary judge did not err in disregarding it when considering whether to draw an inference that the fire was deliberately lit (cf ground 4(c)). And in any event, if the description of that possibility as “fanciful” was erroneous, it was not far off the mark. In circumstances where the Tahiti screen had been on since the previous evening, the occurrence of an electrical fault causing a fire at or very shortly after the time the appellant left the home on the following day (9.28 am) is a remote and speculative possibility.

The timing of flashover

68. The final point made on behalf of Ms Worth as to the likely cause of the living room fire, and in support of grounds 3(b) and 4(a), relates to the time at which flashover took place, accepted to be 9.46 am. The premise of the appellant’s argument is that flashover “occurs within 5-11 minutes of ignition inside a house”. It is said to follow that ignition likely occurred “well after” she left the house at or shortly before 9.28 am.

69. In support of that proposition, the appellant relies on the evidence of Mr Forbes (both in his initial report and in cross-examination) and what is described as a “leading expert text”, Kirk’s Fire Investigations (Prentice Hall, 5^th ed, 2002), which Mr Forbes accepted was “a standard handbook used by fire investigators”.

70. The relevant excerpt of Kirk’s Fire Investigations commences with the observation that the “length of time each state [of fire development] takes will vary (dramatically in some cases) with the circumstances of ignition, fuel, and ventilation”. It includes a series of photographs showing the development of a “well-ventilated, non-accelerated fire in a furnished room ... set in papers in a wastebasket”, which took 10.75 minutes to reach flashover. But it provides no support for the appellant’s claim that house fires usually reach flashover in 5-11 minutes.

71. In his initial report, Mr Forbes observed that flashover “would have occurred within 5-10 minutes of ignition”, a statement necessarily qualified by his earlier observation that a fire ignited by a cigarette might smoulder for 30 minutes before producing flames. He then qualified that opinion further in an affidavit dated 19 April 2018, explaining that it was a “generalised statement” and that “trying to estimate a time to flashover is very difficult, impossible if one does not observe it or know what materials were used as fuel”. He went on to note that if slower-burning material (such as the game guide or an encyclopedia) was the cause of the lounge room fire, time to flashover “would have been significantly longer than 10 minutes”. When the issue was briefly raised in cross-examination, Mr Forbes’ response was in substantially the same terms.

72. Mr Nash also commented on the timing of ignition. Noting that flames were first observed at or just after 9.35 am, in his second report he stated that if the living room fire had its origins in an electrical malfunction, it “would have taken some time” to engage the lounge and produce “sufficient fire development ... for the witness to observe flames coming from the front of the house”. Acknowledging that “[a]ccurate, reliable timeframes would ... be very difficult to determine” because they would depend on the location of any electrical malfunction, its position relative to the lounge, and the combustibility of the relevant items, he thought it “highly likely that the timeframe would exceed the 3 minutes reported between the departure of the owner and the observation of flames”. (In fact, the primary judge found that Ms Worth left the house at or around 9.28 am, earlier than Mr Nash presumed.)

73. The premise of the appellant’s argument is not established. The evidence points uniformly to the conclusion that the time to flashover varies significantly with “the circumstances of ignition, fuel, and ventilation”. It is not necessary to address the respondent’s submission that the time to flashover would also depend “quite evidently [on] the geometry of the space”, which proceeds by reference to the fact that the living and dining rooms were part of a single open space.

The cooktop fire (grounds 3(f) and 6(b)-(e))

The findings as to the cause of the cooktop fire

74. The cooktop fire is dealt with by the primary judge at J [141]-[164], where his Honour commenced at [141] (extracted again for convenience):

As already mentioned, the charred remains of the game guide which were found on the side of the cooktop were missing the first one hundred pages and the front cover. The back of the game guide had semi-circular burn marks which corresponded to the shape of the cooktop, but the book itself was found resting partially on and partially off the left hand side of the cooktop so that the back was not actually on the element.

75. The primary judge reasoned and found as follows:

1. Mr Gardner’s hypothesis that the game guide was knocked from where it was on the windowsill when the blind fell, so that it came to rest open with its pages facing up, partly on the bench top and partly on the cooktop, was for all “practical purposes” to be discounted because “the scientific evidence indicates very strongly that the burning of the game guide was the result of human intervention” (J [164]), “there is no credible explanation for the kitchen fire apart from human intervention” (J [293]), and “it is impossible to see how the game guide could innocently have ended up on the cook top element” (J [294]).

1. There were three “difficulties” for Mr Gardner’s theory. First, it did not directly explain what happened to the first 100 pages of the book, nor why the guide was found with a semicircular burn mark on its back cover which matched the shape of the circular cooktop element, although no part of that back cover was resting on any part of that element when the book was found, as is shown in photograph E64 at [18] above and in close up in photograph E74 below. Mr Gardner’s suggestion was that when the book fell onto the cooktop surface it came to rest partly on and partly off it, lying open with its front cover and first 100 pages resting in part on the element which had been left on. They then caught fire, and the heat from the element spread or “crept” across a semicircular area of the underside of the back cover, which was partly on the cooktop surface but not over the heated element (J [152]-[154]). Secondly, it was not likely that (or “hard to see how”) the window blind could have propelled the book onto the cooktop surface from a position on the windowsill leaning against the glass of the window, because that window was “set back some distance behind the blind”. That meant that the blind would have fallen in a vertical plane in front of the book (J [155], [156]). Thirdly (and most significantly), the kitchen photographs showed that the area of the bench top under the game guide had no soot or debris on it, indicating that the book had “protected” that part of the bench from the hot air, smoke and soot circulated with the spread of the living room fire into the kitchen. If the guide had only come to rest on the cooktop after the fall of the blind, when the heat and smoke had already invaded the kitchen, that area of the bench would not have been protected. The primary judge observed that “it seemed an extraordinary coincidence” that only that part of the bench top would have been cleaned (J [157]-[159]). (As will be seen, that suggestion was not made or adopted by Mr Gardner (cf J [159]), was inconsistent with Mr Forbes’ unchallenged evidence, and was wholly consistent with what was put to Ms Rampling as to the extent of the cleaning which occurred when she was present.)

Photo E74

3. The Londonderry tests in which a game guide was placed directly on the element produced a pattern of damage similar to, but not quite as extensive as, that on the back cover of the book recovered from the fire scene. The relevant tests were numbers 4 and 5, the former using a new copy of the game guide with pages 1 to 100 removed and the remaining pages 101 to the back cover positioned with part of the back cover sitting on a semicircular area of the heating element. Test 4 lasted for 35 minutes, after which the “scorching pattern” on the back cover was similar to that observed on the back cover of the “seized game guide”. Had the game guide only fallen onto the cooktop after the kitchen blind had fallen, it would have been on a heated cooktop for about 15 minutes at the most. That is because shortly after “flashover” occurred, the electricity to the house was turned off and the cooktop would have retained heat capable of igniting or charring the book for less than 10 minutes.

The “protected area” under the game guide

76. The position of the remaining part of the game guide, partially covering the corner of the cooktop, but not any part of the cooktop element (as shown in photo E74), was first observed by Ms Rampling in her inspection on the morning of 2 September 2015. Mr Forbes, Mr Perrin and Detective Wilcox also appear to have been present. There was a further inspection after 2 pm on 2 September 2015 at which at least Messrs Wilcox, King, Forbes, Perrin and Ms Rampling were present. At that time the position of the game guide was photographed by Mr Forbes and Ms Rampling. It was then moved, it would seem by Mr Wilcox, so that the bench top and cooktop under the book could be inspected, as well as the underside of the book (see photo E150 at [18] above). Before this was done the hotplate area was cleaned with cloths. The cloths are shown in photo E611, which is not reproduced. Photos were taken by Mr Forbes showing the “protected area” as well as position to which the book was first moved. At some later stage the book was “replaced in the position in which it was found”, although not exactly, as Mr Forbes noted and as is shown in photograph E83:

Photo E83

77. Mr Forbes described the bench top area under the game guide when it was found as “protected by [the book] during the fire and therefore not covered in soot”, as shown in photo E80, reproduced below:

Photo E80

78. In cross-examination Mr Forbes said, based on what he had seen after the book was first moved, that there was “no soot underneath in that rectangular shape”, from which he concluded that the book was in that position “before the main fire started”. It was not suggested to Mr Forbes in cross-examination that the so-called “protection area” had been scrubbed clean or that there was soot in that area when the book was first lifted and moved. Both Mr Nash and Mr Gardner, neither of whom was present on 2 September 2015, rejected any suggestion that there might have been any good reason for the fire or investigative officers present on that day to have cleaned, let alone scrubbed, the “protected area” to remove signs of soot.

Theories as to how the game guide came to be on the cooktop

79. Ms Worth’s evidence did not offer any explanation for why the game guide was in the kitchen and in a position where it could have ended up on or near the cooktop. Her evidence was that she did not recall seeing it in the kitchen on the day of the fire. That evidence left open the possibility that her son and his friends may have been using the microwave in the kitchen on the afternoon of 31 August 2015 to make popcorn. The primary judge, having referred to that evidence (J [255]), noted that whilst it was possible that her son had taken the game guide into the kitchen, no one actually said that he did. At the time of the hearing, Joshua was 16 years old. He was not called to give evidence (J [106], [238]).

80. Ms Worth’s evidence remained that when she turned the hot plate on and then returned the saucepan to the kitchen cupboard, she did not see the book on the cooktop. If the game guide was where it was found at the time she turned the element on, it is most unlikely that she would not have seen it. There remains to be considered the fact that when found pages 1 to 100 of the game guide were not attached. Mr Forbes’ evidence, based on his observations of the book and cooktop on 2 September 2015, was that it “had been torn in approximately half along the spine which was originally glued together”.

81. Mr Gardner proffered several possibilities as to how the game guide ended up on the cooktop. If one was facing the cooktop, immediately to the left was a microwave oven. To the right of that microwave, and sitting on the benchtop, was a small box about the size of a wide shoebox. The microwave and the top of that box can be seen in photograph E76 below:

Photo E76

82. Initially, Mr Gardner suggested that magazines (and the game guide) stacked in the space around the microwave may have slipped from that position, or from their position on top of the lower cardboard box, and onto the cooktop surface. In his responsive report, Mr Nash said that significant external lateral force would have been required to move any book or magazine which had slipped from either of those positions to the back corner of the cooktop where the game guide was found.

83. Their joint report recorded that there was no “direct physical evidence” explaining how the game guide came to be on the cooktop by the end of the fire. In his second report Mr Gardner put forward two scenarios, the first involving three possibilities, one of which is dealt with in the primary judge’s analysis above. Those scenarios were: (1) that the book was upright on the window ledge behind the cooktop or on the kitchen bench leaning against the windowsill, or on the recipe holder to the left of the cooktop (visible in photo E83), and in each case fell forward onto the cooktop during the fire; or (2) that the book had fallen onto the floor and was picked up by Ms Worth and hurriedly thrown in the direction of the kitchen bench, where it landed on the cooktop. As the primary judge noted at J [149], Ms Worth gave no evidence in support of this second scenario, which was not seriously pursued.

84. As to the first scenario, three mechanisms were proposed by Mr Gardner as having potentially caused the book to end up on the cooktop. They were: impact from the roller blind falling to the window ledge; turbulence created when the glass in the window behind the right side of the cooktop was shattered by heat; or turbulence created by heat from the lounge room causing the magazine to fall onto the cooktop surface (open with its front and back covers facing the bench or cooktop surface). Mr Nash’s response to the first mechanism is summarised by the primary judge at J [155]. At the end of the discussion of this subject in the joint evidence Mr Gardner said that having regard to the “bit of weight in the game guide book” what “I was putting together is possibilities not probabilities ... I can agree it’s probably not quite as likely that the curtain rod, the blind rod would have [knocked the book] off the window ledge given its size and its weight”.

85. Mr Nash’s response to the second of these mechanisms was that because the exterior shutter which covered the kitchen windows, including the window which “thermally cracked”, was closed, there was no opportunity for movement of air outwards from inside the house, causing turbulence, when that cracking occurred. The absence of significant staining to the exterior bricks, which was otherwise likely to have occurred, indicated that the window had been effectively sealed. That left the third mechanism, namely the prospect of fire-induced turbulence within that closed space. Mr Nash’s considered view was that the risk of turbulence in the kitchen sufficient to cause the game guide to fall over was “negligible”. None of this was contradicted by further evidence of Mr Gardner.

86. The more significant difficulty for these mechanisms was that each was itself the result of events only likely to have happened after the fire was well advanced – the melting of the plastic mountings holding the blind in place, the possible ignition of the blind material prior to its falling, the thermal fracture of the windowpane produced by a “temperature differential”, and fire induced turbulence in the kitchen area. That being the position raised the question whether the soot deposition and staining observed elsewhere on the benchtop happened before or after the plastic mountings might have melted or these other events occurred. Mr Nash and Mr Gardner agreed that it would have happened beforehand, Mr Gardner describing the sequence of events as being – “smoke staining all the way down to the floor level in the kitchen... covering the windows and other surfaces... the smoke has happened first and we’ve got a hot gas layer coming in, that’s melted the plastic on the blind... and also, we’ve had enough heat to crack the glass”.

87. The following matters concerning the so-called “protected area” and the theories as to how the game guide came to be on the cooktop require some further elaboration.

88. In his affidavit of 4 December 2019, Mr Forbes said that he had taken photo E77 (below) when he examined the fire scene with Ms Rampling after 2pm on 2 September 2015. At that time he removed the game guide from where it was first seen and “partially cleaned the cooktop to expose the location of the hotplate”. There was no reference to his also cleaning the bench top. He then described repositioning the game guide “by aligning it with the part of the bench top that had been protected by the game guide during the fire and [which] was therefore not covered in soot”. He described that area “as shown” in photo E78 (also below).

Photo E77

Photo E78

89. Ms Rampling gave oral evidence before Mr Forbes and it was plain from his affidavit evidence that she was present when the game guide was first removed from the cooktop surface. The photos of the game guide before that occurred (such as photo E77) plainly showed that the cooktop surface had not been interfered with. In cross-examination Ms Rampling agreed that she was present when “the game guide was removed from the cooktop and the cooktop was scrubbed”. The choice of words of the cross-examiner was precise. Ms Rampling was not asked whether the particular part of the bench top which had been covered by the game guide was also scrubbed. That would have been a curious thing to have done as the two independent experts later commented in their joint evidence. Mr Forbes was shown photo E78 and in the course of questioning about it described the rectangular shape on the bench top as a “protection mark” because there was “no soot underneath in that rectangular shape” which told him that the book was “there before the main fire started”. Notwithstanding that he in a later answer again referred to that “area of protection”, it was not suggested to Mr Forbes that he had scrubbed or cleaned the bench top or that area of the bench top so as to show where the book had been found.

90. When asked to comment on photo E80 (see [77] above) which was described by the appellant’s counsel as showing “some cleaning has been done of the cooktop”, Mr Gardner’s response included that “you’ve got some - a protected area, as indicated by Mr Forbes earlier, where the, the bulk of the magazine was between, it was on the bench top, but also partly on the cooktop”. Later counsel suggested in cross-examination of Mr Nash that someone may have “had a brush and swept away the area said to have been underneath the bottom of the magazine”. Mr Nash accepted that without “seeing it and turning my mind to it, at that time of the examination” it was difficult to comment. Nevertheless he observed that “soot tends to be quite sticky” and that to “clean a triangular section of the bench top” in the exact location where the magazine was positioned “just seems very unlikely. I would never do something like that, and I can’t see a reason for doing something like that.” Mr Gardner added that photos E77 and E78 showed “a clear patch on the bench top” and that having “scrubbed the surface of the cooktop” he could not see “that there’d be any reason to [do additional cleaning on the bench top]”. The primary judge’s observation at J [159] is wrong if it suggests that Mr Gardner provided any support for the suggestion that on 2 September 2015 Mr Forbes, in the presence of Ms Rampling and others, also cleaned the bench top but only in the “protected area”, when neither he nor Ms Rampling had said that he had done so.

91. Finally, Mr Nash and Mr Gardner were not engaging in speculation in suggesting that in the course of the living room fire, smoke from that fire would have filled the kitchen, resulting first in the depositing of soot before the arrival of a hot layer of gas which would have melted plastic and cracked glass. In their joint report, they agreed that the main fire originated in the lounge area and initially developed below an intact ceiling, and that it spread through the house into the kitchen, before spreading into the roof space and causing the damage observed. They also agreed that the fire at the cooktop was negligible in size and did not develop and spread to other areas in the property. There was no issue between them that the mechanisms described by Mr Gardner explaining how the game guide might have ended up on the cooktop had to have occurred after any significant soot and debris from the lounge room fire was deposited on the bench top.

92. By way of summary, the evidence provided a sound basis for finding that the game guide was in the position on the kitchen bench top where it was found from a point in time before any significant soot and debris from the lounge room fire was deposited on the bench top. The evidence does not suggest any plausible explanation for how the book could have got into that position before that time without some human intervention (cf ground 6(e)).

The position of the game guide on the cooktop and whether it had been moved

93. When first observed after the fire (as shown in photos E64 and E74) the game guide was lying open, its back cover face down. Its front cover and pages 1 to 100 were “missing”. It was positioned at an angle with the bottom of its facing page (page 101) closest to the windowsill. As can also be seen in photo E74, the top left hand corner of the charred facing page is positioned very close to the edge of the cooktop at the point where there is a black and orange mark. Mr Forbes’ evidence was that the “orangey brown colour” burn mark in that photograph, which followed the line of the spine of the book (or where that spine would have been) was the result of flames in that area. Mr Nash and Mr Gardner agreed, the latter adding that the mark could have been produced by glue from the binding which burnt or melted onto the top of the bench top.

94. There was a question as to what had happened to the front cover and pages 1 to 100 of the game guide (ground 6(d)). At J [144], the primary judge noted that the evidence of “both Officer Forbes and Mr Nash” was that it was likely the front cover and first 100 pages had been torn off before the game guide came to be on the hot plate. The reference to Mr Nash appears to have been an error. It is likely that his Honour intended to refer to Detective Wilcox, who observed that the guide “appeared to have been torn in approximately half along the spine”. Whether it was not open to his Honour to find that the appellant had likely torn off the front cover and first hundred pages because that proposition was not put to her in cross-examination is addressed separately below.

95. Mr Forbes’ observation that those pages had been removed by tearing along the spine was tested in cross-examination. Ultimately, on the basis of his observations and the Londonderry tests, he rejected as a possibility that the 100 pages had been totally consumed by fire. There was no cross-examination directed to the relevant photographs (including photos E64, 74 and 77) which suggested that there were any identifiable remains of those pages on the cooktop, which Mr Forbes said he expected he would have found. He did accept that there was at least a “theoretical” possibility that the 100 pages were resting on the top of the hot plate and as a result were totally consumed by fire. That possibility was addressed by test 3 of the Londonderry tests.

96. Test 3 involved placing an intact game guide, opened to page 101, with its back cover in the same position as found after the fire – in other words, that cover was not in contact with the element, whereas the front cover and first 100 pages were “draped” over the cooktop element. The test produced flames which consumed the binding joining the first 100 pages, but did not result in all of those pages being burnt, much less consumed, in the 26 minutes of the test. It was suggested to Mr Forbes that this result could have been different if the other heat sources applying in the kitchen at the time of the fire – the general heat due to the main fire and the heat and flames from falling debris – were taken into account. He rejected that suggestion.

97. The remaining controversies were whether the semicircular burn pattern on the back cover of the game guide (as shown in photo E150) could have been caused whilst the game guide was in the position in which it was found, with no part of the back cover on the cooktop element, and (alternatively) whether that burn pattern could have been produced in the period that Ms Worth was in the house and before the game guide was moved to the position in which it was found. The evidence of Mr Forbes and Mr Nash was that the burn pattern could not have been caused other than by direct exposure of the back cover to the cooktop element.

253. After the conclave, Mr Gardner produced a supplementary report in which he postulated that the magazine may have been left upright on the window ledge above the cooktop or sitting on the kitchen bench behind the cooktop or on the bench leaning against the recipe holder beside the cooktop and that it fell forward onto the cooktop during the fire. Mr Gardner postulated three possible mechanisms by which the magazine may have been caused to fall from one or other of those positions: the falling window blind, turbulence caused by the failure of the windowpane or turbulence caused by the fire.

254. Mr Nash responded with a further report dated 4 December 2019 in which he rejected each of those possibilities. In addressing the suggestion that the game guide might have been knocked by the falling blind, he addressed only the possibility that the game guide had been left on the windowsill. Other possibilities had been suggested (the splashback or the recipe guide). Mr Nash’s reasons for refuting the windowsill hypothesis did not apply to those. The recipe guide is close to the hotplate and seems an obvious place to put rest a magazine-style publication in the kitchen.

255. Mr Nash also refuted the turbulence hypothesis but in terms which, in my respectful opinion, were not convincing. As to the possibility that there was a rush of air when the windowpane cracked, he argued that there would not be an “in rush” or “out rush” of air because the external roller shutter over the window was closed. However, he acknowledged that the degree to which the roller shutter sealed the opening was not known. As to the possibility that hot gases produced by the fire would have created displacement of the air within the house, he argued that “significant turbulence would only have occurred close to the fire, with a generally stable hot gas layer above lower cooler air elsewhere”. He said this was particularly the case in any “dead zones” and characterised the long narrow kitchen as such a zone. On that basis he considered the possibility of fire-induced turbulence causing the magazine to fall over as “negligible”. But those observations articulated no assumption as to the degree of turbulence that would be necessary to disturb a magazine of the heavy, glossy composition of the game guide from an unknown position. One has only to consider the nature of such a magazine, which does not have hard covers and is comprised of glossy, heavy pages, to see that it would be difficult to position vertically and might easily slide from a vertical or propped position.

256. Without knowing how the game guide might have been propped up by a 12-year-old boy, it is impossible to make any reliable assumption as to how much force or turbulence would be needed to destabilise it. It is difficult to resist the conclusion that, once the fire experts had ventured into the territory of debating the likelihood of a magazine falling in a particular, they had perhaps become entrenched in their respective positions (I do not confine that criticism to the insurer’s experts; Mr Gardner also made some ambitious claims on that topic).

257. Mr Forbes also provided a further affidavit, also dated 4 December 2019, responding to Mr Gardner’s suggestion that the game guide may have fallen rather than being placed on the hotplate by Ms Worth. It was in that affidavit that he first explained (or at least that I first perceived) that his hypothesis was that Ms Worth must have moved the game guide at some point after she first placed it on top of the element. He gave his reasons for doubting that the magazine could have been knocked or blown onto the cooktop and further stated that, even if that was theoretically possible, his observations of the fire scene “demonstrate that neither of those events occurred”.

258. On that issue, Mr Forbes drew support from the Londonderry tests which he asserted “demonstrated that the charring of the underside of the part game guide could not occur with the part game guide in the position in which it was found”. In my respectful opinion, the Londonderry tests were at best unhelpful; they had the potential to lend an air of scientific authority to a hypothesis that was little more than conjecture. They certainly did not demonstrate that the charring of the underside of the part game guide could not occur with the part game guide in the position in which it was found. I say that because the Londonderry tests wholly failed to replicate the position and circumstances in which the game guide was found.

259. The important tests for present purposes were tests 2 and 3. Mr Forbes described those tests in his first affidavit as follows:

31. The second test commenced at 1:40pm and lasted for 10 minutes and 22 seconds. We placed the Game Guide adjacent to the hotplate where it was observed post fire. In this second test, no damage was occasioned to the magazine. The element heated up to 530 degrees. A thermometer placed under the magazine showed 84 degrees. (Six minutes and six seconds into this test a generator was started in an adjoining shed which compromises the audio quality of the digital recording).

32. One theory discussed between Detective Scott Wilcox, Sarah Southall and [me] was whether the magazine could have been opened at page 101 (the page it was found separated on) and the opened portion open over the hotplate. When we commenced the third test the portion of the magazine opened over the hotplate was barely in contact (due to the spine). About 9 minutes into the test the loose pages over the hotplate caught fire and the open portion dropped onto the hotplate. Those small flames were not enough to have caused the lounge room fire. Once the portion of the game guide dropped onto the hot plate, the fire smouldered and went out. This third test commenced at 2.26pm and lasted for 26 minutes”

265. Mr Gardner was sceptical as to the usefulness of the tests, noting that “it’s really hard to simulate fire conditions in the experimental environment”. I can only say that I share his scepticism. As Mr Gardner noted, the tests were conducted outside in an open area and with the cooktop elevated by about 50 millimetres whereas in Ms Worth’s kitchen it was flush with the benchtop. The effect of those conditions was that the game guide used in the tests was ventilated underneath whereas in Ms Worth’s kitchen it would have been resting flush on the benchtop with no ventilation. The DVD footage starkly demonstrates how freely the area under the game guide was ventilated in test 3. Ventilation was introduced in a different way in test 2 because, rather than having the part game guide sitting flush on the hotplate, it was placed on top of the thick wire thermometer used to measure the heat. A gap between the hotplate and the game guide caused by that wire can plainly be seen in the DVD footage. The DVD footage further shows that the tests were conducted in a breeze whereas the conditions inside the unit on the day of the fire were still and contained. As Mr Forbes himself observed, the kitchen was long and narrow. The hotplate was immediately surrounded on all sides by walls or surfaces of one kind or another. The DVD footage shows that, at the beginning of test 3, the breeze was strong enough to lift one of the pages of the game guide. During that test, the smoke from the smouldering and burning pages was blown away from the hotplate, at times strongly and in changing directions. During the fourth test, the breeze was strong enough to prompt one of the officers to place a small rock on the game guide to keep the fluttering pages in place.

266. In test 3, Mr Forbes sought to test the theory that the magazine could have fallen open at page 101 in the position in which it was found. He placed a copy of the magazine with the opened portion over the hotplate. About nine minutes into the test the loose pages over the hotplate caught fire and the opened portion dropped onto the hotplate. Mr Forbes noted that, once the portion of the game guide dropped onto the hotplate, the fire smouldered and went out. However, as already noted, that was outside in the open air, not in the confined space of Ms Worth's kitchen with another fire developing in the next room.

267. Further, it is clear from the photographs that, in the real fire, the spine of the game guide caught fire and was largely if not completely consumed. That did not happen in test 3. That does not prove that the game guide could not have burned in the manner suggested on behalf of Ms Worth; it proves that Mr Forbes failed to replicate the circumstances of the fire and so could not draw any reliable inference from the experiment. Again, I am not seeking here to play detective. I am simply explaining that I do not understand why that test was thought to discount the possibility that the game guide fell on the hotplate in the position in which it was ultimately found, without ever being moved, and that the pages draping over the hotplate were completely consumed by fire leaving the other half where it was later found, the underside having been charred as a result of smouldering radiating out from the fire in the spine.

268. It is not even clear to me that the game guide in test 3 was accurately placed in the position in which the game guide in the real fire was found. It was positioned adjacent to but not touching the edge of the element. The photographs taken after the real fire indicate that, when allowance is made for where the spine of the game guide would have been, it could well have been touching the element or even encroaching on it.

269. Mr Forbes agreed in cross-examination that the discolouration on the bench was a continuation of the line of the spine of the game guide (in the position in which it was found by investigators). He further agreed that in photograph E78 one could see more of that line of discolouration corresponding to the binding on the game guide and that this indicated that there was a flame along the binding of the game guide during the course of the fire that led to that burn mark being present.

270. It is difficult to reconcile that evidence with the hypothesis that the back of the game guide could only have become charred by being placed directly on top of the hotplate and later moved to the side. That would require the following sequence of events: Ms Worth tore the game guide in half and placed the bottom half with its back cover directly on the hotplate for long enough to char its underneath; she then moved the charred magazine to the side where it protected the surface of the bench; and the spine then caught alight and burned leaving the mark along the bench. If she was trying to burn the house down, it is difficult to think of a reason why she would move it off the hotplate once it had begun to smoulder.

271. It is also difficult to understand how the spine could have caught alight at that point. A hypothesis that is at least equally likely is that offered by Mr Gardner; that the game guide was not moved by human hand; it came to be situated where it was found by investigators diagonally adjacent to or touching the hotplate in an open position with its first 100 pages draping over the hotplate and the rest of the pages flat against the kitchen bench; the hotplate caused the draping pages to ignite (the one thing Mr Forbes’ tests proved can happen); those pages were completely destroyed by fire; during that fire the glued spine also caught fire and left the mark along the cooktop that continued onto the bench; and the fire in the spine combined continued to burn slowly under the back of the game guide assisted by the heat from the hotplate with the result that it radiated out in a semi-circular pattern.

The weight to be given to psychological factors

272. I have summarised the relevant circumstances above. In my opinion, the arson hypothesis attributes Ms Worth with conduct that is quite bizarre. In addition to the matters raised by Ms Worth in her argument that the insurer’s hypothesis does not make psychological sense, there are other aspects of the “human intervention” hypothesis that I find difficult to reconcile with the realistic probabilities. I have referred to some of these already. The bizarre choice of the game guide for fuel and the glass hotplate for ignition is even more bizarre weighed in the context that, if an electrical cause for the living room fire is excluded, the only realistic way to start a fire in that area would be with matches or a lighter. Why not do the same in the kitchen?

273. Secondly, the posited placement of the game guide on the hotplate according to Mr Forbes’ hypothesis is bizarre. Why place it on half the element? Why not directly over the whole element?

274. Thirdly, Mr Forbes’ hypothesis requires Ms Worth to have taken the inexplicable step of moving a smouldering game guide off the hotplate.

Conclusion as to the fire in the kitchen

275. For those reasons, I respectfully disagree with the conclusion reached by Meagher JA at [100] that the innocent hypothesis posited by Ms Worth is not a realistic possibility. It is not necessary for present purposes to be persuaded that the innocent hypothesis is what happened. In my assessment, it is a competing possibility of equal likelihood and the choice between it and the human intervention hypothesis can only be resolved by conjecture. It follows that the insurer’s allegation that the fire in the kitchen was deliberately lit is not proved.

The fire in the living room

276. The evidence concerning the living room fire is discussed in detail in the judgment of Meagher JA. Leaving aside the question of the Tahiti screen, I do not disagree with his Honour’s analysis of that evidence. Having regard to my different conclusion as to the kitchen fire, the point of significance for me concerning the living room fire is that, as both the primary judge and Meagher JA accept, one cannot exclude the possibility that the fire started within the larger area of origin identified by Mr Nash, which included the location of the speakers and the internal stairwell. As noted by Meagher JA, that leaves open the possibility that the fire was caused by an electrical fire starting in the speakers.

277. The larger area of origin identified by Mr Nash also leaves open the possibility that the fire began in the internal stairwell. However, the primary judge dismissed as fanciful the only possibility as to how the fire might have started accidentally in that area, the possibility of an electrical fire starting in the Tahiti screen. Meagher JA has concluded that the primary judge did not err in disregarding that possibility when considering whether to draw an inference that the fire was deliberately lit. I respectfully disagree.

278. My reasons are simple and can be stated briefly. Mr Nash hypothesised that the Tahiti screen could have come to rest on the northern side of the stairs (that is, the opposite side from the side on which it was hung) close enough to the top that flames emitted from the unit could reach the lounge. As Meagher JA has noted, the primary judge treated the likelihood of that event as a question for “the science of mechanics” (in relatively simple applications a matter of “general knowledge”) rather than “fire expertise”. His Honour found the Tahiti screen hypothesis implausible because he thought “a picture unit falling from that height would have fallen down the stairs rather than staying where it fell” and that even if it somehow did come to rest on the staircase it would have come to rest on the southern rather than the northern side of the stairwell.

279. Meagher JA considers that Ms Worth’s criticism of this reasoning as involving “impermissible speculation” (ground 4(d)) about matters the subject of unchallenged evidence is not justified. With respect, I do not understand how the Tahiti screen hypothesis can be dismissed as fanciful other than by a process involving impermissible speculation. No one is in a position to make any assumptions as to the materials from which the screen was made, the materials with which it was hung, what might have happened to its various parts in the event of electrical malfunction, whether it included materials that might have exploded or caught alight and floated as embers, whether it included materials that might have softened so that they would rest where they sat if it dropped, whether it might have fallen at an angle so that it might slide from south to north and come to rest on the side of the stairs adjacent to the sofa, what other household items might have been near the point where it fell and so on. If the primary judge’s hypothesis that “a picture unit falling from that height would have fallen down the stairs rather than staying where it fell” is right, why wasn’t there either some remaining evidence of the unit or more fire damage at the bottom of that flight of stairs? The proposition that, if it rested where it fell, it would have would have come to rest on the southern rather than the northern side of the stairwell also entails a measure of speculation in which I am not prepared to engage. The evidence simply did not allow any reliable inference to be drawn about those matters.

280. In short, once it is accepted (as it was by the experts) that the possibility of electrical fire in the Tahiti screen could not be excluded, I do not understand how the possibility that it was the cause of the fire can be excluded without conjecture. The photograph reproduced by Meagher JA at [35] shows a blue blanket over the back of the sofa. Ms Worth said she thought it was made of wool but the shape and colour suggest the possibility that it was synthetic. Again, I do not seek here to play detective; only to explain why I do not understand, in the face of all of those kinds of imponderables, how the possibility that the Tahiti screen caused the fire could be dismissed as fanciful while the possibility that Ms Worth lit the fire, with all the bizarre features of that hypothesis, was accepted as a reasonable possibility. It is an approach which seems to me to place too much confidence in narrow suppositions as to the laws of mechanics in their application to unknown materials while failing to scrutinise bold suppositions as to how a single mother in straightened financial circumstances might behave.

Financial motive

281. It is appropriate to refer briefly to the contention that the motive for these acts was financial. Meagher JA has discussed this issue at length. I respectfully adopt his Honour’s reasoning and agree with his conclusion that, whilst Ms Worth’s belief that she was over-insured provides a conceivable motive, it is not correct to describe that motive as “substantial” or the evidence of motive as “strong”.

Lies as consciousness of guilt

282. The primary judge accepted that it was not clear why Ms Worth in fact did not respond to those calls but nonetheless concluded that “she must have thought her own actions must have appeared suspicious and in that way the false stories suggest a consciousness of guilt”. Meagher JA considers that did not involve any impermissible reasoning, relying on Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11 at [64]. I respectfully disagree. I note in passing that it is by no means clear to me that Ms Worth lied about those matters. But in any event, to tell a false story out of panic, based on the fear of an action appearing suspicious, is the paradigm example of a lie that might not demonstrate consciousness of guilt. Here, the action about which the primary judge found Ms Worth lied was her failure to respond to a series of telephone calls. In my view, to regard those as lies indicating a consciousness of guilt of the alleged arson indicates a failure to distinguish between lies going to credibility and those indicating guilt, as to which see generally Zoneff v R (2000) 200 CLR 234; [2000] HCA 28. I would uphold ground 7. However, as noted by Meagher JA, the primary judge’s finding on that issue was not determinative of whether Ms Worth lit the fire; it was simply one matter taken into account.

Conclusion and orders

283. Accordingly, I would allow the appeal and make the following orders:

1. Allow the appeal.

2. Set aside Order (1) made on 19 March 2020 and Orders (1) to (4) made on 17 April 2020.

3. Judgment for the appellant against the respondent for the sum of $464,384, together with interest pursuant to Insurance Contracts Act 1984 (Cth) s 57, from 1 January 2016 to 26 August 2021 of $124,649, and $60.39 per day until the date of payment.

4. Dismiss the cross-claim.

5. Order the respondent to pay the appellant’s costs at first instance and on appeal.

6. Direct the appellant within 14 days of today’s date to file a written submission providing her calculation of the interest to be awarded to her, with the respondent to file any differing calculation within 7 days thereafter.

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Amendments

06 September 2021 - Order (3) varied to correct judgment sum and include interest calculations.

Decision last updated: 06 September 2021