Supreme Court New South Wales

• Medium Neutral Citation: DAOUD v GIO GENERAL LIMITED [2011] NSWSC 1001
• Hearing dates: Wednesday 31 August 2011
• Decision date: 01 September 2011
• Jurisdiction: Common Law
• Before: Hall J

Decision

1. Appeal allowed.

2. Order setting aside the judgment of the Local Court delivered on 2 February 2011.

3. Order that the proceedings be remitted to the Local Court pursuant to s.41(1)(c) of the Local Court Act for determination by the Local Court by another Magistrate.

4. Order the respondent to pay the appellant's costs of and incidental to the proceedings in this Court.

• Catchwords: Administrative law - appeal from Local Court - whether Magistrate gave adequate reasons - error of law - defence involving fraud
• Legislation Cited: Insurance Contracts Act 1984; Local Court Act 2007
• Cases Cited: Alchin v Daley [2009] NSWCA 418; Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430; Briginshaw v Briginshaw (1938) 60 CLR 336; Campbelltown City Council v Vegan & Ors [2006] NSWCA 284; (2006) 67 NSWLR 372; Mifsud v Campbell (1991) 21 NSWLR 725; Neat Holdings Pty Limited v Karajan Holdings Pty Limited (1992) 67 ALJR 1; Soulemezis v Dudley Holdings Pty Limited (1987) 10 NSWLR 247
• Category: Principal judgment
• Parties: NABIH DAOUD v GIO GENERAL LIMITED
• Representation: P: M Campbell; D: J Sleight; P: Peter Michael Ives; D: Hicksons Lawyers
• File Number(s): 2011/68389

Judgment

1 The plaintiff/appellant commenced proceedings by way of summons commencing an appeal filed on 2 March 2011.

2 By that summons, the plaintiff appeals from the whole of the decision of the Local Court in respect of a claim brought against the defendant/ respondent under a policy of insurance.

Background and proceedings in the Local Court

3 On or about 20 August 2007, the defendant issued the plaintiff with a policy of insurance in respect of a Toyota Kluger motor vehicle.

4 On 20 September 2008, the plaintiff alleged that he was involved in a motor vehicle accident at the intersection of Elizabeth Drive and Cecil Road, Cecil Park.

5 The proceedings were commenced in the Local Court by way of Statement of Claim filed on 11 June 2009. On 2 October 2009, a Defence was filed.

6 The first matter raised in the Defence was the respondent's reliance upon terms and conditions contained in the contract of insurance. The next matter raised (paragraph 3) was a statement of non-admission that there was a collision on the date alleged (20 September 2008). There was then pleaded the following:-

"3. In answer to paragraph 3 of the Statement of Claim, the defendant:-

(a) ...

(b) states that if there was such a collision, it was not accidental, but was deliberately staged by the plaintiff;

..."

7 In paragraph 4 of the Defence, it was pleaded, inter alia:-

"4. In answer to paragraph 4 of the Statement of Claim, the defendant:-

(a) ...

(b) ...

(c) states that the claim under the contract of insurance made by the plaintiff is made fraudulently;

(b) states that [sic] reason of the fraud, the defendant is entitled to avoid payment claimed by the plaintiff pursuant to s.56 of the Insurance Contracts Act;

..."

8 The hearing proceeded before the Local Court on two days, 9 September 2010 and 2 February 2011. On the latter date, the learned Magistrate delivered an ex tempore judgment in favour of the defendant, the respondent to the present proceedings.

9 At the hearing, an agreed statement of facts was tendered, a copy of which was Annexure A to the affidavit of Peter Michael Ives, solicitor for the plaintiff, sworn on 21 June 2011.

10 The agreed facts were:-

"1. On or about 20 August 2007, the defendant issued the plaintiff with a policy of insurance which the defendant agreed to indemnify the plaintiff against accidental loss or damage for motor vehicle Toyota Kluger ... owned by the plaintiff.

2. On 20 August 2008, the plaintiff alleges he was involved in a motor vehicle accident at the time at the intersection of Elizabeth Drive and Cecil Road, Cecil Park.

3. The plaintiff made a claim on 20 August 2008.

4. The alleged accident involved another motor vehicle allegedly driven by Ousama Najjar.

5. The motor vehicle was damaged beyond economic repair.

6. The defendant has refused to make payment under the policy as set out in its letter of 27 February 2009 and cancelled the policy.

Issues

1. Did the accident occur in the manner claimed by the plaintiff?

2. If so, was the accident deliberately staged by the plaintiff?"

11 A copy of the defendant's letter of 27 February 2009 was Annexure B to Mr Ives' abovementioned affidavit. The letter stated, inter alia:-

"We refer to your claim and advise that our investigations have revealed that the circumstances of the loss are contrary to what you represented to us.

Investigations revealed that there was no evidence that the accident occurred as stated by you and, furthermore, the forensic collision report reflects that there are concerns in relation to the actual circumstances of this staged event.

Accordingly, GIO General Limited refused payment of your claim in accordance with the terms and conditions of your policy and section 56 of the Insurance Contracts Act 1984 ... on the basis this claim has been made fraudulently. Additionally, we consider that you have breached section 13 of the Act by failing to comply with your duty of utmost good faith in your lodgement of this claim.

We refer to your claim and advise that GIO General Limited is unable to accept your claim.

..."

12 The policy went on to state that the defendant had decided to cancel the policy in accordance with s.60 of the Insurance Contracts Act 1984.

13 A copy of a statement by the plaintiff dated 19 March 2010 was annexed to Mr Ives' abovementioned affidavit.

14 The plaintiff described in the statement how he entered the intersection of Elizabeth Drive and Cecil Road. He stated:-

"17. I looked right and left at the intersection.

18. I noticed that there was an oncoming car on my left with its blinker on to turn right. That car turned right into Cecil Road.

19. I commenced to enter the road at Elizabeth Drive to turn right when another car on my left collided with my car. This car hit my Toyota on the left hand side damaging the front left hand guard and both doors.

20. The impact of the collision spun my car around and it ended up on the side of the road in the opposite direction. I was dazed and in shock, I sat in the car for a few minutes. The other driver came to me and said words to the effect of:-

'Am I alright?'

21. I asked him the same question and he said words to the effect, 'I'm okay'."

15 The plaintiff proceeded to then give an account of the fact that he had injured his head, right arm and shoulder and that he consequently suffered headaches and sleep difficulties and back pain. He said he saw a doctor on the same day of the accident about his injuries. He also said that he exchanged details with the other driver. He said that he called a tow truck driver who towed his car to the panel beating shop. The tow truck driver then drove him home.

16 The plaintiff, after having arrived home, telephoned the respondent and advised the person to whom he spoke of the accident and answered some questions put to him about it.

17 Annexed to Mr Ives' affidavit were copies of photographs and a diagram prepared by the plaintiff (Exhibit 5 in the Local Court proceedings). Also annexed to the affidavit (Annexure H) was a copy of a report of John Jamieson dated 11 June 2010 (Exhibit 6 in the Local Court proceedings).

The present proceedings

18 The plaintiff relied upon the affidavit of Mr Ives to which was annexed a copy of the proceedings before the Local Court on 9 September 2010 and 2 February 2011.

19 The present appeal is brought pursuant to s.39(1) of the Local Court Act 2007. That section provides for a right of appeal on a question of law. In the summons commencing the appeal, the plaintiff relied upon five alleged errors of law.

20 In the written submissions on behalf of the plaintiff it was stated:-

"12. In summary, there are two main issues, firstly, his Honour failed to provide proper, adequate reasons that addressed the matters that needed to be decided, and, secondly, his Honour failed to have proper regard to all the evidence before him and made a finding that was not open on the evidence."

21 The oral evidence before the Local Court consisted of the evidence of the plaintiff and Mr Najjar, the other driver of the vehicle involved in the accident and expert witnesses.

22 The plaintiff relied upon the report of Mr Jamieson, traffic engineer dated 11 June 2010. The defendant relied upon an accident reconstruction expert, Mr Mark Sculthorpe, who provided a report dated 12 March 2010.

23 Mr Sculthorpe was described in his forensic investigation report as a "Forensic Collision Investigator & Motor Vehicle Collision Reconstructionist" .

24 On the present appeal, the plaintiff/appellant was represented by Ms Michelle Campbell of counsel, who also appeared on behalf of the plaintiff in the Local Court. The defendant/respondent was represented by Mr James Sleight of counsel, who also appeared on behalf of the defendant in the Local Court.

25 Ms Campbell relied on written submissions in the present proceedings dated 22 July 2011. Mr Sleight relied upon his written submissions dated 5 August 2011.

26 In order to understand how the grounds of appeal relate to the issues that the learned Magistrate was required to determine, it is necessary to say something about the facts in issue and the expert evidence called by both parties.

27 Mr Sculthorpe was engaged by the defendant and visited the accident site for the first time some 12 weeks after the event, namely, on 11 December 2008. He described the relevant intersection between Cecil Road and its conjunction with Elizabeth Drive at Cecil Park. At the time, the appellant was travelling in a south-easterly direction along Cecil Road towards the intersection of the two roads. The other driver, Mr Najjar, was proceeding in his BMW vehicle along Elizabeth Drive in a westerly direction. The appellant was driving his silver Toyota Kluger 4 wheel drive station sedan.

28 The collision is said to have occurred at about 9.50 am on Saturday 20 September 2008. The appellant gave a version of events leading to the accident. These included the fact that he looked right and left at the intersection. He noticed an on-coming car on his left with its blinker light on to turn right. It then turned right into Cecil Road.

29 He said that he commenced to enter the road at Elizabeth Drive to turn right when another vehicle on his left collided with his car hitting the Toyota vehicle on the left hand side damaging the front left hand guard and both doors.

30 He stated that the impact of the collision spun his car around and it ended up on the side of the road in the opposite direction. He said he was dazed and in shock and he sat in the car for a few moments.

31 In his report, Mr Sculthorpe analysed a number of aspects concerning the accident and the vehicles involved in it. Included in his analysis were expressions of opinions as to the following matters which were material to the Magistrate's ultimate determination:-

(1) The angle of impact

If both vehicles had become involved in the collision with each other whilst moving through the intersection in a normal manner, they would not have impacted with each other at or about 90-degree angle to each other. He stated that the damage profiles of the vehicles indicated that there had not been an impact of the near side of the appellant's vehicle at an approximate 90-degree angle but that there had been two collisions. That was not consistent with the normal movement of a vehicle passing through such an intersection. In other words, Mr Sculthorpe advanced the proposition that there were two separate occasions on which the vehicles impacted which occurred whilst the appellant's vehicle was stationary.

(2) Spinning of the vehicle post-impact

That the appellant's vehicle's damage profile indicated that any post-impact rotation was not as the plaintiff described, namely, the vehicle spinning around to face the opposite direction, but that any post-impact rotation would only have been slight and in a clockwise direction.

(3) Absence of horizontal damage marks

The appellant's vehicle did not, as would be expected, have displayed horizontal scuff marks or striations upon its damaged near side body panels.

(4) Area of damage to the other vehicle

The extent of distortion and damage on the vehicle's near side revealed greater crush and distortion than its off-side. This was said to be consistent with the front of the BMW vehicle being made to impact with the side of the Toyota Kluger vehicle on two occasions.

32 In relation to the above matters, particular attention was directed in this appeal to the issues of the angle of impact (paragraph [31](1) above) and the issue of the spinning of the vehicle issue (paragraphs [32](2) above). The analysis of these issues were directly relevant to the accident reconstruction analysis undertaken by Mr Sculthorpe and it was necessary for the Magistrate to analyse his evidence and, where it conflicted with the expert evidence of Mr Jamieson, to provide reasons as to why he did not accept the analysis of Mr Jamieson and did accept the evidence of Mr Sculthorpe.

33 As discussed below, the learned Magistrate did not, in my respectful opinion, provide an analysis and adequate reasons in relation to disputed matters that were central to the accident reconstruction exercise undertaken by Mr Sculthorpe.

34 In relation to [31](1) above, Mr Jamieson, in his report, examined the question of what was described as the "impact angle" . He expressed his opinion, in particular, by reference to figure 10 and 11 to his report, having regard to the angled intersection and its openness that a 90-degree collision on the site was quite possible. He explained his reasoning for that opinion.

35 In relation to the opinion expressed by Mr Sculthorpe to the effect that a double imprint of the BMW's front number plate indicated two separate impacts had occurred (implying that the damage by some kind of staged collision), Mr Jamieson expressed a contrary view. For reasons developed in his report, he was of the opinion that the event probably only involved one (primary) collision with double contact occurring during the course of the single collision. He supported that opinion by reference to tests, he said, were conducted by the US Insurance Institute of Highway Safety. He enclosed a DVD which he said showed the test.

36 Mr Jamieson further stated that crash researchers have all been well aware for many years that the dynamics of a side impact can involve a double contact. He explained the dynamics which would explain how such a double contact could occur as a result of a single impact. He opined that the double imprint was probably caused by a double contact between the sideways sliding Kluger vehicle and the rolling BMW vehicle.

37 The issue of double impact was significant, inter alia, because, if accepted, it would explain the absence of scratches, horizontal marks or striations along the relevant panels of the Toyota Kluger.

38 Mr Sleight accepted that there were three bases or reasons which went to support the Magistrate's finding of a staged accident. These were:-

(1) The absence of striation marks.

(2) Damage to the "bullet vehicle" (the Toyota Kluger) based upon the damage to the BMW vehicle (and the cause of such damage).

(3) The spinning action of the appellant's vehicle as a result of the impact.

39 The question at issue on this appeal was whether or not the Local Court judgment displayed adequate reasons for a finding in favour of the respondent based on the three matters referred to above or on any one of those matters and for the ultimate determination made in the reasons for decision.

Adequacy of reasons

40 In a case such as the present, it is important that the onus of proof be properly applied. In these proceedings, the onus was on the plaintiff to prove on the balance of probabilities that his vehicle was damaged in an accidental collision. It was for the defendant, having pleaded fraud, to prove fraud on the balance of probabilities in the manner formulated in Briginshaw v Briginshaw (1938) 60 CLR 336. See, for example, Vidal v NRMA Insurance Limited [2004] NSWSC 123 at [10]. I will return below to the application of the Briginshaw standard in the present case when dealing with the absence of adequate reasons in the judgment the subject of this appeal.

41 It was submitted on behalf of the respondent, which I accept, that it is not necessary for the Local Court in a matter such as the present to give lengthy and elaborate reasons. However, that does not permit that Court to determine facts in issue without addressing the matters that are subjacent to the determination of the ultimate questions in the proceedings and the disputed evidence on such matters. That is especially so in a case such as the present in which the respondent raised a defence of fraud and a finding to that effect was made.

42 The principles in relation to the duty to give adequate reasons are well-known. In Alchin v Daley [2009] NSWCA 418, Sackville AJA (with whom McColl and Young JJA agreed) identified the relevant principles in determining whether a judge had given adequate reasons for making findings of fact. His Honour enunciated the following principles by reference to the relevant case law:-

(1) The giving of adequate reasons lies at the heart of the judicial process, since a failure to provide sufficient reasons can lead to a real sense of grievance because the losing party cannot understand why he or she lost.

(2) While lengthy and elaborate reasons are not required, at a minimum, the trial judge's reasons should be adequate for the exercise of a facility of appeal, where that facility is available.

(3) The extent and content of the reasons will depend on the particular case and the issues under consideration, but it is essential to expose the reasoning on a point critical to the contest between the parties. This may require the judge to refer to evidence which is critical to the proper determination of the issue in dispute.

43 The principles have been stated and reviewed by the Court of Appeal on a number of occasions: see Campbelltown City Council v Vegan & Ors [2006] NSWCA 284; (2006) 67 NSWLR 372 at 399 per Basten JA who observed that a failure to give reasons by a tribunal for its decision will constitute an error of law which will permit the decision to be set aside on appeal where the right of appeal is limited to errors of law); see also Soulemezis v Dudley Holdings Pty Limited (1987) 10 NSWLR 247 at 200 per Kirby P; Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430 at 442 per Meagher JA.

44 The learned Magistrate set out his reasons at pp.71 and 72 of the transcript of 2 February 2011 at the conclusion of submissions. They were as follows:-

"HIS HONOUR: Thank you. There will be judgment for the defendant. I think that the plaintiff has failed to discharge the onus and, indeed, I think that it is more probable than not that the accident was staged. I agree, as I said a moment ago, that the plaintiff himself was a very good witness. Nonetheless, it seems to me, that those matters that I was particularly drawing attention to a few moments ago must be decisive and accord with what Mr Sculthorpe says. The first thing to notice is that the plaintiff's vehicle would have been, as he says it was, at a bit of an angle as it turned, in spite of Mr Jamieson's postulation of a different turning scenario, which was, I think, an improbable one; one simply wouldn't [sic] it. It would be a bit of an angle and if he was hit by the BMW in a legitimate way, as he says it was, there would have been a sideways impact with horizontal striation marks on the Kluger and there weren't.

I think it is a little less probable that there would have been a double impact in the way the plaintiff says. I agree it could happen. Mr Jamieson says it could; It's happened before, he's seen it on the net and so forth. It can happen but Mr Sculthorpe has done a lot of tests and he says he's never seen it happen. I think it's less likely to happen and that helps. As Mr Sculthorpe says, the damage to the BMW in the way he described by reference to photos, particularly 28 and perhaps 29, in his report, show that there was a square-on collision with the force - I think one can summarise what he says as the force being distributed evenly from across the front of the BMW down towards the back and a lot of impact on the left-hand side, the passenger side of the bonnet. That's where the A pillar of the Kluger did all the damage to it, but nonetheless, that square-on impact is inconsistent with the kind of glancing blow that must have occurred if the BMW had been coming down the road and struck the Kluger at a point where the Kluger was angled beginning to commence its turn.

Mr Ajjar's [sic] evidence, in my view, can't be accepted. He says he saw the other car 8 or 9 metres away and he braked. Well, that's not possible. You can't react and brake in that time and if he didn't brake, there would have been much more damage and it would have been a glancing blow with the horizontal striations we spoke of. If he did brake, it was faster that Wyatt Earp, and it's just not feasible. Judgment for the defendant."

45 I will refer below to a number of discrete matters arising from the Magistrate's decision. It is sufficient here to note:-

(1) In the present case in which there was a considerable amount of expert evidence given by Mr Sculthorpe and Mr Jamieson, it is, in my opinion, unsatisfactory for the decision maker to seek to abbreviate the decision by references to discussions that occurred in the exchange with counsel as effectively forming part of the decision. This applies to statements made such as "... as I said a moment ago ..." and the subsequent reference "... those matters that I was particularly drawn attention to a few moments ago must be decisive ..." . Discussion occurred on the present appeal as to precisely what the learned Magistrate was referring to and it was far from clear as to what particular matters his Honour was referring to.

(2) The issue of the angle of turning as the vehicle made its turn is one that was the subject of analysis by Mr Jamieson. If accepted, it would explain how an angle of close to 90 degrees could have occurred, as the plaintiff said it did. The finding made simply that it was "improbable" without explaining why Mr Jamieson's opinion could not be accepted.

(3) That the two references to the absence of horizontal striations is, at least, in partly tied to the issue as to whether there was a "double impact" . Whilst the Magistrate acknowledged it could happen, as Mr Jamieson opined, the Magistrate simply adopted Mr Sculthorpe's contrary opinion. However, Mr Sculthorpe did not provide any underpinning analysis or any reference to scientific literature to support his opinion in that respect. He simply said he had not seen a double contact occur in his experience.

(4) I raised the question as to what the Magistrate intended by his reference to "Mr Ajjar's [sic] evidence, in my view, can't be accepted" . The context appears to be that the Magistrate was saying that he could not accept Mr Najjar's evidence about having seen the other car eight or nine metres away and then braked. However, the Magistrate does not make clear whether he was intending to impugn the whole of Mr Najjar's evidence. If he was, and I consider that unlikely, one would have expected the Magistrate to have identified particular matters of fact and made express adverse findings on those matters as the underpinning for any general rejection of Mr Najjar's evidence. As I have stated, this was unlikely. That, however, gives rise to another difficulty with the judgment so far as Mr Najjar's evidence is concerned as discussed below.

46 It was noted in the written submissions for the respondent that the reasons set out were said to be "... the culmination of a number of interactions that have taken place between ... counsel and his Honour" (paragraph 13).

47 It was submitted that the reasoning process adopted by the Magistrate in reaching his judgment was amply revealed in the interchange between counsel and the bench. It was submitted it would be artificial and misleading to take the Magistrate's concluding remarks out of the context of the immediately preceding proceedings (paragraph 14).

48 It was again emphasised that there was a need to follow the "flow from the interchange" (paragraph 15).

49 On the contested issue as to the issue of the Toyota vehicle spinning after the collision, it was noted in the respondent's written submissions that his Honour referred in that respect to Mr Sculthorpe's evidence (paragraph 16). Reference was made to the interchange with counsel on the point.

50 There is, however, a difficulty in respect of the conclusions reached on this issue. Firstly, there is no identification or exposition of any reasoning leading to the conclusion as to why Mr Sculthorpe's evidence was accepted or on what basis and why, notwithstanding the Magistrate's assessment of the appellant as "a very good witness" , he apparently did not accept the plaintiff's account which was that his vehicle was spun around. He did not say anything as to why or on what basis he would not accept the plaintiff's. There was, in other words, no attempt to reconcile the conflict between Mr Sculthorpe and the appellant on what became one of the foundational issues addressed in relation to accident reconstruction. All his Honour stated was:-

"... nonetheless, it seems to me that those matters that I was particularly drawing attention to a few moments ago must be decisive and accord with what Mr Sculthorpe said."

51 I raised with Mr Sleight during the course of submissions the difficulty of understanding what his Honour was referring in his reasons for decision by the reference to the matters that he had raised "a few moments ago" . Mr Sleight took me to p.65 of the transcript of 2 February 2011 from lines 25 to 31. However, that passage had to be understood in the light of the previous passage commencing at line 10 on that page. Both paragraphs contained observations made by the learned Magistrate in his exchange with Ms Campbell during submissions. It is not necessary here to attempt to disentangle the various matters that his Honour there made reference to. The observation in a decision to matters discussed in submissions without identifying what was specifically in mind does not assist.

52 It seems clear that his Honour simply accepted Mr Sculthorpe's opinion evidence that the vehicle would not have spun around as the appellant said had in fact occurred. There was no discussion by the learned Magistrate to analyse the basis for Mr Sculthorpe's evidence in order to arrive at the conclusion that the vehicle would not have spun around but would have only shunted sideways. As I have stated above, this was particularly relevant, given that the plaintiff's evidence appears to have been accepted without qualification. This is based upon his Honour's statement in the reasons for decision at p.71, line 27, in which he said, "... the plaintiff himself was a very good witness ..." . The matter of whether the car spun around was one of the matters upon which the Magistrate concluded the collision was a staged collision (that is, a fraudulent one).

53 The issue as to the angle of approach of the appellant's vehicle (paragraph [31](1) above) was a further issue that was very much in dispute between Mr Jamieson and Mr Sculthorpe. The Magistrate ultimately adopted Mr Sculthorpe's analysis but did so without explaining why one expert was accepted over the other. This too was said to be an important issue in the determination of the facts and issues between the parties and the ultimate determination of the proceedings.

54 In the context of a defence based on fraud, it was necessary that the Magistrate explain his reasoning process and how he derived his conclusion on that issue for, if Mr Jamieson's analysis was valid, it would have thrown Mr Sculthorpe's fundamental opinion of two separate collisions very much into doubt.

55 In relation to the question of the double imprint of the BMW registration number and the possibility of its explanation lying in there being double contact as a result of a primary collision (and also explaining the absence of striations etc), the learned Magistrate did not accept Mr Jamieson's analysis, although it would appear from general comments the learned Magistrate made in the course of argument that he accepted that Mr Jamieson's explanation as to double impact was at least a possible one

56 This issue also fundamental in determining whether or not there was a valid explanation as to the absence of striation and other marks as emphasised in Mr Sculthorpe's report. Accordingly, the provision of adequate reasons on the issue referred to in the preceding paragraph (and why one expert was accepted over the other) was essential. The reasons for decision do not, in my opinion, contain adequate reasons in that respect.

57 Mr Sculthorpe's response to Mr Jamieson's analysis on the question of a double impact (and also explaining the double imprint of the BMW number plate) was that he did not accept that the concept of double contact in a primary collision occurs essentially on the basis that he had not seen it in the many tests he had been involved in. Mr Sculthorpe, however, provided no basis for that opinion nor any analysis which would lead to the conclusion that Mr Jamieson's proposition was an invalid one. Mr Jamieson, as earlier noted, provided an engineering explanation of the dynamics that cause "double impact" and supplied a DVD which was said to demonstrate the double contact issue. There was no challenge by Mr Sculthorpe based on analysis or reference to scientific literature to refute Mr Jamieson. These matters emphasise the requirement that existed for the Magistrate to explain why and on what basis he did not accept Mr Jamieson's opinion on a matter that was fundamental to a fact in issue. This, his Honour, failed to do.

58 In relation to the particular factual matters relied upon by the respondent as providing a basis for the Magistrate's decision, I have not lost sight of the particular matters raised and relied upon in the respondent's written submissions including, in particular, those referred to in paragraphs [17] to [23]. However, certain of those matters are questions of fact which would need to be considered by a tribunal of fact but only in the context of a proper analysis of the competing expert opinions produced by the parties.

59 I have concluded that the reasons for the decision of the learned Magistrate did not comply with or give effect to the principles to which reference is made in paragraphs [42] and [43] above. That failure constituted an error of law. Accordingly, the appeal must be upheld on that basis.

60 Samuels JA in Mifsud v Campbell (1991) 21 NSWLR 725 observed at 728, that the failure of a court to give attention in a decision to the evidence on an issue that is contrary to an assertion of fact made by one party so as to indicate the basis for rejecting the evidence, tends to deny both the fact and appearance of justice having been done. In such a case, such failure will have worked a miscarriage of justice and have produced a mistrial which constitutes an error of law which is reviewable on appeal.

61 It is not necessary that each of the other grounds relied upon be separately discussed. It is sufficient to say that they would require leave to appeal and no such leave was sought.

62 There is one matter that I raised earlier concerning the evidence of Mr Najjar's evidence. If, as earlier stated, the learned Magistrate was intending only to reject Mr Najjar's evidence on only aspect (having seen the vehicle eight to nine metres ahead), then it follows that he otherwise made no adverse findings against Mr Najjar. On that basis, there would be no reason not to accept his evidence of the events leading up to the collision. However, the Magistrate does not deal with that aspect in his Honour's short judgment. This matter assumes some significance insofar as the learned Magistrate, as earlier noted, accepted the plaintiff as "a very good witness" and, on the construction of his comments concerning Mr Najjar, to which I have earlier referred, it also appears that, but for the matter of seeing the vehicle eight to nine metres away, he otherwise made no adverse findings against Mr Najjar.

63 There is one matter that is germane to the importance of the inadequacy of reasons in the present case. A defence of fraud is only to be raised upon careful consideration. A finding of fraud, of course, can only be made on the basis of cogent evidence that meets the test enunciated by the High Court in Briginshaw v Briginshaw (supra) at 362 per Dixon J (as his Honour then was). Se also Neat Holdings Pty Limited v Karajan Holdings Pty Limited (1992) 67 ALJR 1 at 171.

64 In the present case, there was no other evidence against the plaintiff than Mr Sculthorpe's opinion evidence, important parts of which were challenged by Mr Jamieson. The other driver was called. The Magistrate found the plaintiff to be "a very good witness" . His Honour made no particular adverse findings of fact against the plaintiff before finding that he staged the collision (that is, engaged in fraudulent conduct). The principles and their application in making a grave finding of fraud were not addressed by the learned Magistrate in his reasons for decision set out above before making the finding of a staged collision. In a case where no negative or adverse findings of fact were made against a party, where an affirmative finding was made in favour of that party that he was a "very good witness" , the need for a proper analysis of expert opinion evidence called to establish a defence of fraud against that party is, of course, essential, as is the provision of adequate reasons for any finding of fraud based on the expert evidence.

65 In the circumstances of this case, the nature of the issues are such that it is not, in my opinion, possible for this Court to determine the issues between the parties and that the proceedings must be referred back to the Local Court for re-hearing before another Magistrate and I so order.

66 I will hear the parties as to any questions of costs.

Decision last updated: 02 September 2011