Reliance Financial Services (NSW) Pty Ltd v Abdallah [2013] NSWCA 125

Case Note: Reliance Financial Services (NSW) Pty Ltd v Abdallah [2013] NSWCA 125

The case examines the principles the courts adhere to when considering appeals based on findings of fact arising from determinations of credibility made by a trial judge. It restates the primacy the trial judge is to be given in such situations as the one actually able to perceive the demeanor of witnesses, and that a failure to give reasons why some evidence is not preferred will not alone be sufficient to successfully ground an appeal.

Facts
The case concerned whether Mr Michael Abdallah owed certain moneys to Reliance Financial Services Pty Ltd or, whether the moneys were in fact repayments of advancements made by Abdallah to Mr Sam Cassiniti (trustee for Reliance). Reliance pointed to executed loan agreements between Cassiniti and Abdallah detailing the money it claimed was owed. Abdallah rather, argued that the loan agreements were something he signed at the request of Cassiniti so as to avoid potential money laundering charges and for other taxation related reasons: at [20]. Each party to the proceedings adduced inconsistent and, at times, differing evidence in support of their respective cases, including the recounting of an incident involving $550,000 in a bag that was handed by Abdallah to Cassiniti to be placed in a safe in the latter’s office: [14]. In the NSW Supreme Court, the trial judge, Black J, ultimately found Abdallah’s evidence to be preferable and consistent with objectively verifiable facts, such as the aforementioned loan agreements. Reliance appealed the decision to the NSW Court of Appeal on the basis that Black J had failed to give reasons for why he preferred some of Abdallah’s evidence to Reliance’s.

The Court of Appeal Decision
The court (Bathurst CJ, and Beazley P and Macfarlan JA agreeing) dismissed the appeal on the basis of that Reliance could not show that the conclusions reached by the trial judge were “glaringly improbable”: at [96]; see, Fox v Percy [2003] HCA 22 at [28]-[29]. In stating the law, this does not mean the trial judge must “state expressly his or her reasons for each factual finding made which led to, or was relevant to, his or her ultimate conclusions of fact”: at [101]. Rather all that is required is “that the essential ground or grounds upon which the decision rests should be articulated”: at [101]; see, Soulemezi v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 28 (per McHugh J). In light of the fact that a trial judge is taken to have a considerable advantage in assessing the credibility of witnesses, as compared to that of an appellate court simply reading the transcript, the latter is only to reverse a finding based on an omission to record reasons as to why the former “has made a made a finding of fact contrary to the evidence of a witness” where that “advantage enjoyed by the trial judge by reason of having seen and heard the witnesses, could not be sufficient to explain of justify the trial judge’s conclusion”: Abalos v Australian Postal Commission (1990) 171 CLR 167 at 178 (per McHugh J), citing Watt or Thomas v Thomas [1947] AC 484 at 488. Bathurst CJ alternately put the proposition in terms of the primary judge having “too fragile a base to support his or her findings based on credibility that the findings will be overturned and a new trial ordered”: at [98]. In this case, the court found that the trial judge had given sufficient reasons for preferring the evidence of Abdallah over Reliance, and such matters that he did not address individually were found to have been done so when the evidence and his reasons were considered at a whole.

Conclusion
The decision ultimately rests on the fact that the court found the trial judge did address the various issues in each party’s evidence, and articulated why he preferred Abdallah’s to Reliance’s. However, Bathurst CJ also articulated the bases upon which appellate courts should look at such issues in future. Importantly, it would seem that so long as trial courts articulate the reasons the “essential grounds” upon which a decision is based, they are safe from appellate review. That being said, in doing so a trial judge will naturally address why one party’s evidence is preferred over another’s, and therefore, the test appears to be whether the factual basis upon which a decision rests is sufficiently strong to support it.