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Appeals in the strictest sense of the word as explained in Yehia v Williams

The Appeal

Yehia v Williams [2022] VSC 197 (Yehia) concerned an appeal against the orders made by Magistrate Foster, pursuant to section 109 of the Magistrates’ Court Act 1989 (Vic).

William Roberts Lawyers acted for the (successful) Respondent in Yehia, Mr Williams, pursuant to instructions from his subrogated insurer. William Roberts Lawyers challenged many of the alleged questions of law set out in the Appellant’s Notice of Appeal on the basis that they were really questions of fact and, for that reason, the Supreme Court of Victoria did not have the power to determine those questions by reason of section 109 of the Magistrates’ Court Act 1989 (VIC).

By way of background:

  1. On 17 September 2019, Mr Yehia was driving his vehicle when it was struck by Mr Williams’ Vehicle. Mr Williams subsequently admitted liability. The matter then proceeded to trial in July 2020, on the basis that the quantum claimed by Mr Yehia was disputed.
  2. On 4 August 2020, the Magistrates’ Court of Victoria ordered Mr Williams to pay the sum of $24,842.11 for cost of repairs, $345.20 for the loss of use claim, $440.00 for assessment fees, $605.00 for towing and storage costs and that Mr Yehia pay Mr Williams’ legal costs on an indemnity basis.

Findings of Broad Applicability

The Court, in Yehia, made the following two findings that are broadly applicable and discussed in further detail below:

  1. As Yehia was an appeal under section 109 of the Magistrates’ Court Act 1989 (VIC), it should be determined on the state of the law as it stood when the case was determined at first instance. Accordingly, the Magistrate did not err by requiring the Appellant to prove need. The effect of this finding is that Arsalan v Rixon; Nguyen v Cassim (2021) 395 ALR 390 (Arsalan) would not apply to an appeal of a judgment delivered before Arsalan was decided.
  2. Her Honour decided that the Appellant was not entitled to recover the cost of hiring a replacement car as his vehicle was illegal to drive on Victorian roads. As a result of this decision, if a defendant is able to prove that a plaintiff’s vehicle could not legally be driven, they may be able to limit the plaintiff’s loss of use claim to a recovery of interest on the capital value of their vehicle.

Did the Magistrate err in law for finding that the Appellant had to prove a need for car hire, and that he failed to establish such a need?

The first issue that arose for determination with respect to the hire car claim was whether the decision of Arsalan applied to the appeal.

One of the purported questions contained in the Appellant’s Notice of Appeal was whether the Magistrate erred in law for finding that the Appellant had to prove a need for car hire, and that he failed to establish such a need.

Whether the Appellant ought to have established a ‘need’ for the hire vehicle was a question specifically addressed by the High Court of Australia in Arsalan. On 8 December 2021, the High Court expressly disapproved of the language of “need” for a replacement vehicle as a matter of legal principle. Instead, the decision in Arsalan establishes that it will not usually be difficult for a plaintiff to establish heads of damage of physical inconvenience and loss of amenity of use consequential upon their lost ability to use their vehicle.”: at [34]. Accordingly, the High Court held that establishing the appropriate heads of damage will not be subject to a high threshold.

The Court in Yehia was the first Supreme Court decision to consider the applicability of the principles in Arsalan.  Her Honour, Tsalamandris J, held that the Appeal ought to be determined by reference to the law that applied at the time the judgment was delivered (as held by McHugh JA in Eggins v Brooms Head Bowling & Recreational Club Ltd (1986) 5 NSWLR 521such that Arsalan did not have any impact on the Appeal. Her Honour held, at paragraph 142 of the judgment, that “As this is an appeal to be determined in the strict sense, it should be determined on the state of the law as it was at the time the case was determined.” Accordingly, the Appellant could not argue that the Magistrate was in error by requiring him to prove need at the trial.

Further, and in the alternative, did the Magistrate err in law by finding that the purported illegality of driving the vehicle on Victorian roads barred recovery for car hire costs?

In the event that her Honour was wrong with respect to the answer given to the above question, the issue of illegality was determined. It was not in dispute that the relevant Victorian road safety regulations prohibited the Appellant from driving his vehicle on Victorian roads as he had not notified VicRoads of the modifications made to his vehicle.

Her Honour held that the Appellant was permitted to admire his car, but not use it on the road. Accordingly, to award the Appellant the cost of a replacement car would put him in a better position than he was in at the time of collision, which would be contrary to the compensatory purpose of an award of damages. In particular, paragraph 164 of the judgment states:

The Magistrate awarded Mr Yehia damages for his inability to enjoy and appreciate his vehicle in the period in which it could have been repaired. The damages he awarded for that loss of use was by application of percentage of capital value. That was indeed the approach endorsed by the High Court in Arsalan for situations when a replacement vehicle was not the appropriate measure.

Questions of Law or Not – that is the question

In the appeal, Justice Tsalamandris considered the following other “questions of law”:

  1. Did the Magistrate err in law and fail to afford the Applicant natural justice and procedural fairness?
  2. Did the Magistrate err in law in not awarding the cost of replacement of the vehicle and instead awarded the cost of repairs?
  3. Did the Magistrate err in law for not awarding interest on the judgment sum?
  4. Did the Magistrate err in law when he awarded indemnity costs against the Applicant?

Did the Magistrate err in law and fail to afford the Appellant natural justice and procedural fairness?

In relation to this question of law, her Honour was required to determine whether the Appellant was denied procedural fairness because the Respondent cross-examined the Appellant on whether the Appellant’s vehicle had, in fact, sold despite not pleading the point in the Respondent’s defence. Her Honour held that the Appellant was not denied procedural fairness by Magistrate Foster because the Appellant’s ownership of the vehicle was not material to the Respondent’s defence.

Relevantly, her Honour held at paragraph 93 of the judgment that “in circumstances where there was no objection by Mr Yehia’s counsel at trial in respect of the Magistrate determining the issue, it is not open to Mr Yehia to now claim he was taken by surprise and denied procedural fairness.

Did the Magistrate err in law in not awarding the cost of replacement of the vehicle and instead awarded the cost of repairs?

Her Honour agreed with the Respondent’s submission that this question was one of fact rather than law holding, at paragraph 113 of the judgment, that “Such a complaint does not constitute an error of law.”

Did the Magistrate err in law for not awarding interest on the judgment sum?

In answering this question in the Respondent’s favour her Honour held, at paragraph 174 of the judgment:

“I am not persuaded that the Magistrate erred in law … the Magistrate was satisfied that there was good cause to refuse interest on the damages award given his findings that Mr Yehia ‘contrived to pretend’ he had sold the vehicle and was unreasonable in rejecting the pre-settlement offer. There was no error by the Magistrate in the exercise of his discretion and I therefore dismiss this ground of the appeal.”

Did the Magistrate err in law when he awarded indemnity costs against the Appellant?

Her Honour was not persuaded that the Magistrate erred in respect of the indemnity costs order made against the Appellant.

The content of this article is intended to provide a general guide to the subject matter. Specific advice should be sought about your specific circumstances.

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