Liquidated damages clauses can be found in pretty much any commercial contract that you come across and must be paid by one party to the other in the event of breach.
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The case of Fox v Percy (2003) 214 CLR 118 raised questions of principles as to the approach to be taken by an appellate Court when reviewing a trial judge’s finding of fact and revisits the principles of serious reservations about the findings of facts, even those based on the credibility of witnesses. Furthermore, this case has been influential in addressing the principles of appeals specifically relating to evidence in both civil and criminal law matters.
Summary of the reason for decision
The case of Fox v Percy confirms a long line of other decisions of appellate Courts regarding an appeal Court’s authority to review a trial judge’s finding of fact. The High Court confirmed that an appeal Court can intervene with a trial judge’s finding of facts based on oral evidence if, for example:
- The facts are incontrovertible; or
- The decision at trial was “glaringly improbable”1 or “contrary to compelling inferences”2.
Fox v Percy followed the High Court case of Devries v Australian National Railways Commission (1993) 177 CLR 472 and the reason for decision can be summarised by the following excerpt from Devries at 479:
“If the trial judge’s finding depends to any substantial degree on the credibility of the witness, the finding must stand unless it can be shown that the trial judge ‘has failed to use or has palpably misused his advantage’3 or has acted on evidence which was ‘inconsistent with facts incontrovertibly established by the evidence’ or which was ‘glaringly improbable’.”4
Although Callinan J considered that the test in Devries was higher than was needed by applicable legislation and the decision of the lower Court could just simply be “wrong”.
Facts of the case
Ms Percy was driving her kombi van downhill. Ms Fox and her companion Mr Murdoch were riding their horses uphill when a collision occurred. As a result, Ms Fox was seriously injured, and her horse was killed. The principal issue at trial was whether the Ms Percy’s van was on the correct or incorrect side of the road. Each party said that at the time that the collision occurred they were on the correct side of the road. Soon after the collision, the police and ambulance were called to the scene.
The evidence was that when both the police and ambulance officer arrived, they stated the stationary van was on its correct side of the road. Police Constable Volf detailed the evidence in his notebook. He noted 10-metre skid marks on the road immediately behind the kombi van, leading up to the point of the accident, were on the correct side of the road for Ms Percy’s van to be travelling on.
The primary judge in the New South Wales District Court concluded that Ms Percy was, in fact, driving her van on the incorrect side of the road at the time of the collision. Substantial damages were subsequently awarded to the Plaintiff, Ms Fox who was riding her horse.
The primary judge specified three reasons for his conclusions:
- His Honour accepted the Plaintiff’s testimony and rejected that of the Defendant;
- His Honour accepted the police record, and in particular, the discovery of the skid marks immediately behind the van, however, his Honour concluded that there had been some animosity on the part of Constable Volf towards Ms Fox which he felt had ‘colour[ed] his investigation of the situation’;5 and
- His Honour accepted the expert report of a traffic engineer tendered by Ms Fox (even though he did not provide oral evidence at the trial).
The New South Wales Court of Appeal, however, reversed the original judgment, where, by majority, it was determined that Ms Percy was indeed on the correct side of the road. The horse rider, Ms Fox, then appealed to the High Court. The High Court unanimously affirmed that the appeal should be dismissed, and the verdict of the Court of Appeal upheld.
The High Court held that the New South Wales Court of Appeal was correct in setting aside the District Court’s verdict. The High Court held that the evidence of the case supported Ms Percy’s version of events that she was in fact driving her van on the correct side of the road.
Henderson v Queensland
Another case of similar legal consideration as Fox v Percy is the case of Henderson v Queensland (2014) 255 CLR 1, where at  it was stated:
“To discharge its appellate function, the Court of Appeal was, and this Court is, obliged to reach its own conclusion as to the inference to be drawn from the primary facts found by the primary judge if an to the extent that the correct inference to be drawn is put in issue in the appeal”.6
Key Takeaways from the case
Essentially, the case of Fox v Percy afforded an opportunity for the High Court of Australia to revisit the principles of serious reservations about the findings of facts, even those based on the credibility of witnesses. Where a judge explains the reasoning to a conclusion by reference to the impression of witnesses, this, in the past, had usually been fatal to those who challenge trial conclusions based on such evidence.
The significance of the case
This case has been cited by many judges and has been influential in addressing the legal principles of appeals. The principles of this case have also been influential and applied through criminal appeal contexts, despite it being a civil dispute.
 Brunskill v Sovereign Marine & General Insurance Co Ltd (1985) 62 ALR 53 at .
 Chambers v Jobling (1986) 7 NSWLR 1 at .
 SS Hontestroom v SS Sagaporack  AC 3 at .
 Brunskill (1985) 59 ALJR, at 844; 62 ALR, at .
 Fox v Perry  HCA 22 at .
 Warren v Coombes (1979) 142 CLR 531 at  and ; Fox v Percy (2003) 214 CLR 118; Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330.
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