Speech by the President to the Sparke Helmore Judges’ Series
Speech delivered by the President on 13 August 2024
JUDGES’ SERIES – SPARKE HELMORE LAWYERS
Delivered by President, Judge G.M. Phillips
Tuesday 13 August 2024
Firstly, I want to thank Sparke Helmore for the kind invitation to address this forum this evening.
I think the Judges’ Series which the firm has established is a commendable innovation. Early on in my time as a judge, I read a book entitled “Advocacy and Judging” by former Chief Justice of the High Court Murray Gleeson AC, GBS, KC. In one section he opined that the time-honoured lament that judges were, quote “out of touch”, was a mischaracterisation. Rather, given the work judges undertake, the Chief Justice argued that alas the opposite was true. Judges see every day the whole gamut of human behaviour and often sadly the worst of it, meaning we are all completely in touch. To the contrary, what was really meant when this statement was made, was that judges were “out of reach” to most members of the community. In many respects given what we do, that is not a bad thing. But it does lead to misapprehensions about the work of judges, and why certain cases are decided the way they are may be misunderstood, so any opportunity to inform and educate is thus very welcome. So, I congratulate the firm on commissioning this Judges’ Series of talks as providing such an opportunity to inform and educate.
Now John Coorey, a long-time Partner of Sparke Helmore who I have known since University days both in the lecture theatre and on the rugby pitch, has said I can speak on whatever topic I choose, which in other circumstances would be a potentially dangerous invitation, so I will deny myself that indulgence tonight.
I have reflected on the audience here tonight and I will cover the following three areas which I hope you find of interest, and then I would be glad to take any questions that you might have. The three areas I will cover are these.
I will start with my observations of insurers and litigation. The second is my observations of how cases are presented and a few personal preferences as to how this may be improved and hence improve one’s prospect of success. Finally, I will say something about appeals. These are my observations and they are not designed to be comprehensive remarks or statements that may be of universal application. But you might like to reflect on what I have to say.
INSURERS AS LITIGANTS
As you know I am the President of the Personal Injury Commission which deals with workers compensation and motor accidents cases. This past reporting year 2023-24, we have finalised more than 18,000 applications of all types across the two Divisions. A large percentage of those appearing, probably up to 50%, are from the insurance industry defending claims brought by citizens.
The insurance industry, needless to say, is a big litigator across Australia’s courts and tribunals.
If you reflect upon these 2 classes of litigants, a citizen and an insurer, you will notice the following differences.
For the citizen this might be the only time in their life they are before a court or tribunal or have instructed lawyers in an adversarial context. They will have an incomplete understanding of the process, no matter how good their lawyer is at advising them about relevant matters as the case unfolds. They may have a number of completely incorrect expectations or views of what can be achieved in the proceedings, consisting of views which they picked up from family and friends or worse still, what they have seen on TV, the media or online. They may have very low levels of trust in what they see as “the system”, lawyers generally, or the insurer they are opposing. Anxiety and emotion as well as intellect will be in play. All the indices which measure these things show that citizens’ trust in important institutions in our society is falling. The courts and judges, alas, are not immune from this contagion.
But the result of the case will be very important to that citizen’s life in terms of their financial situation, family and their health. It is frequently impossible for emotion to be divorced from the proceedings, especially if the person is seriously aggrieved about what they see as the wrong that has been visited upon them. This emotion may also relate to what they perceive as poor behaviour by an insurer in dealing with the claim. All of this could result in poor decisions being made by that person during the proceedings.
Contrast this situation to that of an insurance company. The insurer is a frequent and sophisticated litigator, well acquainted with the law in the area in which they are operating. They have a lawyer who they engage on multiple occasions who is probably quite a trusted advisor, who is also highly skilled in the area of practice. The result of the case may or may not affect the year-end result of the company. The case may be one of a portfolio of cases the individual is dealing with. The result may or may not (in all likelihood, not) constitute a poor precedent for the future operations of the insurance company or its policy holders. Going to court is not the same threatening or emotional event that it is for an individual litigant, rather it is a daily part of the job. Losing is not a crushing circumstance in a financial or emotional sense.
When you look at it like this, the differences between the two litigants could not be more stark. I am sure the picture I have painted is very familiar to you all. But it is a picture that you must be aware of and reflect on because if you don’t try to understand these differing drivers of behaviour, you will make poor decisions in cases.
Before a case is brought against an insurer, usually a claimant has lodged the claim and dealt with the insurer, which has ended in a refusal to indemnify or accept the claim. How this exchange is conducted will often dictate how acrimonious and costly the subsequent litigation is – so my advice is that courtesy is everything when dealing with the claimant. The claimant is entitled to be treated professionally, with courtesy and they are entitled to relevant information. Withholding information, unless there is a sound legal reason to do so, poisons the well with the claimant and in any event once proceedings are commenced, the information can be obtained or subpoenaed. Far better they are supplied with the information so that their lawyer can be better instructed. It means that their litigation lawyer can focus on the real issues, for example, a non-disclosure that would have affected accepting the risk or the premium, rather than proceeding on a wider basis.
I often see where at an early stage when the claim is denied, it is denied on the basis of the information existent at that point and this may be a very sound position given what may be a lack of evidence. But as the claim progresses to litigation and more evidence is produced, that original decision to deny frequently does not change. It can look to an independent observer that the claims manager is fearful of changing the earlier decision.
So, the message is this – as circumstances change, be prepared to change your mind on a prior denial of liability. Lots of cases before the Commission see an insurer defending a decision made at a time when the claim or supporting evidence was imperfect, but once it was prepared the decision still did not change and the insurer subsequently loses.
This often happens when the claims manager fails to sit in during the case and their lawyer cannot get instructions as the evidence has come out in an unexpected way. I know you have a lot of cases, but where you can, you should be there in court. It will make you better at your role and enhance your experience.
I would also say this – judgement is not something you can study or buy. It is acquired over time by experience, by making mistakes and learning the right lessons from those mistakes. Do not get too excited by the evidence you have collected, especially expert evidence. You must exercise judgement about the evidence, the first question you must ask is this - is it admissible? Do I think it is credible knowing what I otherwise know about the case? Is it persuasive and based upon known or provable facts? What do we not have? Namely what are the gaps or holes in the evidence? What is Plan B or our alternate argument? Bear in mind some experts do miss the point, is the opinion relevantly based on provable facts and directed to the issues in contest?
Remember this quote from a German Field Marshall Von Moltke in the 19th Century which was to the effect that, “No plan survives first contact with the enemy.” This absolutely applies to evidence in cases, a lot does not survive the first half hour of cross-examination. What looked like a good case on paper frequently can go up in smoke once cross-examination commences.
Be careful of placing all your money on the expert’s opinion being accepted in full or that you can prove all of the underlying facts or assumptions upon which the opinion is based. My own view is that greater care needs to be taken in instructing experts both initially and during the currency of the proceedings. And if further facts emerge after the expert has provided their report, these facts must be brought to the expert’s attention and the opinion modified or confirmed. An expert who fails to make proper concessions when confronted with plausible alternatives or different facts is no use to you or the judge hearing the case.
What I am saying is that you need to be flexible, you need to be ready to change your mind as the facts change or new material emerges. You need to have a sober and clear-eyed view about the strengths and weaknesses of your case.
And I will say this – in my 30 years of practice as a solicitor, I never once regretted settling a case, even one I was sure we would win. A silk I used a lot in WA told me the hardest cases to win were often the ones that you should win but often you don’t win these. A decision from a judge should be the last resort after all attempts to resolve the matter have failed. Remember when you settle a case, it is you who are in control. And as an insurer once it is resolved, you can close your book on the case. No appeals, no further costs, just lunch with the legal team.
In practice I often observed an insurer making a reasonable and proper offer of settlement which was rejected by the claimant, sometimes against advice. Now I get that once rejected the offer is gone. I have seen where later on the claimant has a change of heart, maybe they were in a better position mentally to think clearly about the offer only to have an insurer say no, the offer is gone or it’s much less. This always left me feeling slightly uneasy, like it was a game being played.
Between a pair of commercial combatants, fine, I get this.
But if you are going to do this to a real live human being, who you were prepared to make that offer to the day before, that needs careful reflection. Because once you do this, the case will never thereafter be capable of resolution. As I said above, you must be careful at all stages to not poison the well. You may have a good day and feel on top, this can change and later on you may be desperate to resolve the case. Don’t do anything which can prejudice the ability to negotiate.
CASE PRESENTATION
I once was at a presentation given by Supreme Court Justice Elizabeth Fullerton SC who, when describing how one should present a case, recommended Armani and a serious pair of glasses. I think she was looking at me and my mates.
But she did say this – if you have a problem in your case, and let’s face it no case is ever perfect, deal with the problem direct. Tell the judge the view they should take of the problem or why is it not germane to a fact in issue that needs to be decided.
Do not ignore it and hope that nobody notices. A silk I used to brief would seize on an opponent’s weakness and hammer it mercilessly, often this would cause damage to other parts of their case. You can stop this by dealing with the issue directly.
One thing that has surprised me since becoming a judge is this – if there is a problem in a case or a problem with the evidence, it will quickly become evident. Sometimes the judge, being a fresh pair of eyes, will see it immediately, so you must deal with it.
Next, it never ceases to amaze me how many counsel think that a good case strategy involves:
(a) Keeping all bases in the case open.
(b) Not telling the Bench in terms what the issues are that require a decision.
(c) Not answering a judge’s question directly. If there is one thing that upsets any judge this is the one. If I ask a question, counsel is being gifted an opportunity to persuade me to their point of view on that issue. Let me give you an example, I will often ask counsel “Why shouldn’t I take this view of the evidence?” That is an opportunity to be seized with both hands, it is gold – obviously it is an issue that I am interested in and is one that I think needs a decision, why not help the court and advance your client’s case? My estimation is that this type of question gets dodged or not answered directly at least 50% of the times I ask it.
(d) Running every conceivable point, meritorious or not. Judges dislike this intently.
(e) And finally, not making obvious concessions. This is not helpful and simply increases the time and cost of the proceedings. It also causes a suspicion you have no case and are simply conducting a strict proof exercise. It also draws more attention to that issue.
The best counsel and clients are those who very early on identify the issues in contest and issues that I as the judge have to decide. You have no idea how much easier that makes it for me to follow and understand their case and arguments. That’s why I said that counsel keeping all bases open is a real bug bear, it makes it far harder to follow what the case being pursued really is. Think of it this way, if the counsel has trouble articulating what the case is, what am I to make of that?
Finally, and I don’t mean this paper to be the definitive guide, I want to say a few things about the arguments that you ultimately pursue in a case. Some clients think conducting a case on the broadest basis possible is a winning approach.
It’s not.
You run the risk that the good points or evidence in your case are obscured by the poor ones.
You run the risk that the person hearing the case completely misses the point because it was hidden beneath a mountain of both useful and useless submissions and evidence – this is the “not seeing the wood for the trees trap”. It’s a trap that some litigants fall into. Remember when the decision is reserved, it is me sitting at my desk working out who wins and why. Make it easy for the judge to follow your thinking and arguments.
And do not forget it is the duty of the lawyer to present a case cost effectively and efficiently. In the Commission I head, the establishing Act directs parties to focus on the real issues in dispute, quickly, justly and cost effectively.
So, to the lawyers present I hope these suggestions are helpful. To those of you who are clients instructing lawyers, you need to put them in a position where they can present the case along the lines I have flagged.
APPEALS
If you are interested in maximising your chances on appeal, there is a very detailed paper I gave to the UNSW Law School in March this year on our website and I commend a reading of it to you.
Now contrary to everything I said earlier tonight, if you do run a case to a verdict and lose, what tips or guidance can I give you?
I do not profess any perfection in this regard, I ran any number of cases in practice which ended as glorious and some not so glorious defeats. Whilst victory has many fathers, defeat is an orphan as President John F. Kennedy said ruefully after the Bay of Pigs fiasco. And that orphan often wants revenge in the appellate courts. So that person is probably not the best person to be making the decision about whether to appeal. My advice is by all means get your counsel to advise but depending on what is at stake, a different counsel who does more appellate work should be retained. Appellate advice and advocacy is a discrete skill which not every good trial lawyer has or is good at.
I would also say this. A first instance loss is galling but it may not be the end of the world. Worse things happen at sea.
Losing in the Court of Appeal though is a loss of an entirely different magnitude. Theirs are decisions which are widely read, reported and commented on.
It is not a place to fly a kite.
So do not compound a first instance loss by losing upstairs.
But if you do appeal the starting point axiomatically is that you must establish error of the relevant kind, that is depending upon the appeal regime you are working in, an error of fact, law or discretion.
A lot of appeals are an impermissible recontest of the merits dressed up as error. Avoid this. No appeal judge likes this and it gets found out very rapidly.
Your appeal grounds must identify the error in a meaningful way. If you cannot do this, do not appeal, you will lose.
Be very wary of thinking you can knock over factual findings made by the first instance judge - this can happen, but it is relatively rare. You must be able to show that the finding was wrong. Usually, a judge is confronted with two evidentiary paths to go down, if they are both available on the evidence and one has been preferred (and there are reasons why one was preferred), you will not succeed in overturning the finding.
Do not say the error appears in these various paragraphs of the first instance decision. Do not leave the appeal judge to speculate what or where the error is. In CFMMEU v Quirk[1], the Full Federal Court said: “There must be a limit upon how far this Court is required to go in dealing with every contention that is floated into the air. Manifesting ingenuity in marshalling as many arguments as possible is no proper aspiration for a barrister.” And later: “there is a further responsibility to identify with precision the alleged error, understanding its significance in the overall scheme of the controversy between the parties.”
And bear in mind not all errors are created equal. Intervention on appeal will only occur if the error affected the result[2].
If you are alleging that there was a failure to give reasons or any adequate reasons, you need to consider this – are you appealing from a court or an administrative tribunal? If the latter, you will need to look in the statute and what the Parliament has said about the tribunal’s duty to give reasons – it is not the same general law duty that sits with judicial officers. Or it may sit in the tribunal’s rules. This is a bit of a trap for young players or the unwary[3].
And the duty to give reasons does not extend to referring to every piece of evidence or every argument that was made. What must be ascertained is whether the decision-maker has exposed the reasons in deciding a point critical in the contest between the parties[4]. The reasons do not have to be lengthy, they just need to show the path of reasoning in deciding the particular issue.
Likewise, a failure to deal with an argument advanced below is only appealable if the argument was material to the issues in the proceedings. In short it is not an error not to refer to or decide every argument advanced[5].
If you are alleging a lack of procedural fairness, again that lack of procedural fairness must have affected the result.
But the real key is this – identify the error with precision, say how it fits within the context of the overall dispute and how did it affect the result? Do this and you are on your way.
CONCLUSION
I hope these remarks have been of benefit to you – I would be happy to field any questions that you might have.
Judge G.M. Phillips
President, Personal Injury Commission of New South Wales
[1] [2023] FCAFC 163, [441]–[442]
[2] Gerlach v Clifton Bricks Pty Ltd [2002] HCA 22, [6]–[7].
[3] Fisher v Nonconformist Pty Ltd [2024] NSWCA 32 per Kirk JA.
[4] Ming v Director of Public Prosecutions (NSW) [2022] NSWCA 209.
[5] Wang v State of New South Wales [2019] NSWCA 263, [63].