Arifagic v Gate Gourmet Services Pty Limited
[2007] NSWWCCPD 94
•13 April 2007
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS
CITATION:Arifagic v Gate Gourmet Services Pty Limited [2007] NSWWCCPD 94
APPELLANT: Sabaheta (Sabrina) Arifagic
RESPONDENT: Gate Gourmet Services Pty Limited
INSURER:QBE Workers Compensation (NSW) Limited
FILE NUMBER: WCC7013-06
DATE OF REGISTRAR’S DECISION: 22 August 2006
DATE OF APPEAL DECISION: 13 April 2007
SUBJECT MATTER OF DECISION: Appeal against the Registrar’s decision in relation to costs: professional costs - claim under Items 2.04A, 2.05, 2.06, 4.03B, 4.07, 4.08, 4.09, 4.12 and 10.01 of the Compensation Costs table in Schedule 6 of the Workers Compensation Regulation 2003; disbursements - medical report and investigator’s report.
PRESIDENTIAL MEMBER: Acting Deputy President Julian Martin
HEARING:On the papers
REPRESENTATION: Appellant: McCabe Partners Lawyers
Respondent: Hicksons Lawyers
ORDERS MADE ON APPEAL: 1. The Registrar’s determination of a Claim for Costs in this matter, dated 22 August 2006 is amended in accordance with these reasons.
2.No order as to costs of the appeal.
BACKGROUND
Substantive Proceedings
On 15 December 2004 Sabaheta (Sabrina) Arifagic (‘Ms Arifagic’) commenced proceedings in the Workers Compensation Commission (‘the Commission’) against Gate Gourmet Services Pty Limited (‘Gate Gourmet’) claiming weekly benefits compensation, medical and related expenses and lump sum compensation.
A teleconference was held with the parties on 23 February 2005 when the matter was referred to an Approved Medical Specialist. As a result of this referral a Medical Assessment Certificate was issued on 6 December 2005 and a second teleconference was listed for 20 February 2006 when the matter resolved. The Arbitrator issued a Certificate of Determination on 21 February 2006 which was amended on 27 February 2006. The Amended Certificate of Determination included an order that Gate Gourmet pay Ms Arifagic’s “costs as agreed or assessed”.
The parties did not agree on costs and Ms Arifagic’s solicitor lodged an Application for Assessment of Costs on 4 May 2006.
The costs were determined by the Registrar’s delegate, a Commission Arbitrator (‘the Delegate’) on 22 August 2006. The decision is as follows:
“1.Pursuant to the issue of a Certificate of Determination on 21 February 2004 [sic] the Respondent employer is liable to pay the Applicant’s costs of the proceedings as agreed or assessed.
2.The Applicant’s costs of the proceedings are assessed at $7,257.00 inclusive of GST.
3.The Applicant’s costs of the assessment are assessed at $605.00 inclusive of GST.
4.The Respondent is to pay the amount of $7,862.00 inclusive of GST to the Applicant if those costs have not already been paid.”
On 8 September 2006 Ms Arifagic lodged an Appeal from the Delegate’s decision.
ON THE PAPERS
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:
“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Gate Gourmet submit that the matter should be dealt with ‘on the papers’ whilst Ms Arifagic is silent on this issue.
I have both the Commission file regarding the cost dispute and the appeal file. In addition I have the substantive file and am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.
ISSUES IN DISPUTE
Ms Arifagic’s solicitor submits that the Delegate erred in relation to professional costs and claim under Item 2.04A, Item 2.05, Item 2.06, Item 4.03B, Item 4.07, Item 4.08, Item 4.09, Item 4.12 and Item 10.01.
Ms Arifagic’s solicitor further submits that the Delegate erred in relation to the following disbursements:
·Medical report, and
·Private Investigator’s report costs
PRELIMINARY
Part 19 of the Workers Compensation Regulation 2003 (‘the Regulations’) govern both the procedure for assessment of costs and appeals against such an assessment.
Clause 119(1) of the Regulations limits the grounds on which an appeal may be made against the determination of the Registrar on an assessment of costs to a matter of law. As Deputy President Fleming stated in Berger v Moree Plains Shire Council [2005] NSWWCCPD152 (‘Berger’s case’):
“The determination of these questions by a costs assessor, is a matter of discretion and, as I said in Nebauer v Hunter Area Health Service [2004] NSWWCCPD 60 (at para 19):
“Only where the discretion can be said to have miscarried because it was exercised unfairly and unlawfully, taking into account the scope of the discretion, and the objects or purpose for which it is conferred, would it be an error of law (Swan Hill Corporation v Bradbury (1937) 56 CLR 746 at 758; R v Australian Broadcasting Tribunal; ex p 2HD Pty Ltd (1979) 144 CLR 45 at 49; Sheridan v David Anthony Clarke t/as Freestyle Marine Sports [2003] NSWWCCPD9).””
On 11 September 2006 the Registrar issued a Direction that Ms Arifagic serve on Gate Gourmet a sealed copy of the Appeal and a copy of the Direction. Gate Gourmet were directed to lodge with the Commission a Notice of Opposition in Reply by 3 October 2006.
Gate Gourmet lodged the Notice of Opposition in Reply on 4 October 2006, one day late. Leave is now sought to admit this document which was served on Ms Arifagic on 4 October 2006.
There is no strict time limit on appeals from an assessment of costs and although the Notice of Opposition in Reply was filed and served outside the time directed by the Registrar, I propose to admit it.
SUBMISSIONS, DISCUSSION AND FINDINGS
Professional costs
Item 2.04A
Item 2.04A allows (at the relevant time) $100 per hour for preparing a witness statement, where a claim cannot be brought without such statement, up to a maximum amount of $150.
In the Application for Assessment of Costs Ms Arifagic’s solicitor claimed $150 for this Item stating that Ms Arifagic’s previous solicitors obtained a statement from her on 21 January 2004. The Delegate determined that it was not reasonably necessary to obtain Ms Arifagic’s statement pursuant to Item 2.04A, as it could have been obtained at the time of taking initial instructions.
On appeal it is submitted that the initial instructions were taken from Ms Arifagic on 22 October 2003. It is further submitted that Item 2.01, which allows a maximum of 2 hours for taking instructions, refers to taking oral instructions and does not provide sufficient time for taking a statement.
I see no error of law or discretion on the part of the Delegate in regard to this Item. Ms Arifagic’s solicitor was allowed the maximum amount under Item 2.01 which makes no reference to ‘oral’ instructions. As Deputy President Fleming stated in Berger’s case at paragraph 141:
“It is possible, under that regime, [costs regime] for a statement by the worker to be taken either at the time of taking instructions (for which 2 hours is allowed pursuant to Item 2.01) or at some later time (Item 2.04A)…”
Item 2.05
Item 2.05 allows $100 (at the relevant time) for ‘briefing a factual investigator or other investigator to obtain evidence other than witness statements’.
Ms Arifagic’s solicitor claimed $100 and the Delegate disallowed the claim because the private investigator’s report from St George Registration & Investigation Services P/L (‘St George’) provided no written report or tax invoice, but simply documents attached to cover sheets “…which could have been obtained by the Solicitor for the Applicant”. The Delegate further stated “…there appears to be no relevant investigations conducted by the Investigator”.
On appeal it is submitted that the Delegate failed to provide adequate reasons and this constitutes an error of law. I do not agree with this submission. As Deputy President Fleming stated in Orr v Direct Couriers (Australia) Pty Ltd [2004] NSWWCCPD 28 (‘Orr’s case’):
“In my view it is not necessary for the Registrar, or her delegate, to set out lengthy written reasons for a decision in order to comply with the Act and the Rules. To do so would be unreasonable and inconsistent with the objectives of the Commission in providing a speedy resolution to workers compensation disputes.”
I am satisfied that in the circumstances the Delegate provided adequate reasons for the decision.
It is further submitted that the Delegate “obviously” did not have access to the substantive file and his failure to consider the record of the Commission amounts to an error of law. There is some merit to this submission because although the Delegate did have access to the substantive file, it appears that he may have overlooked part of the contents of the report from St George.
The Delegate in his determination sets out the documents contained under cover sheets from St George as follows:
“(a)Business Name Search.
(b)Medical Evidence (Page 137).
(c)Taxation/Wages Schedule (Page 165).
(d)Correspondence - QBE Insurance (Page 168).”
The report from St George also included a statement from Ms Arifagic dated 7 September 2004, a Factual and Liability Summary and a Vocational Assessment Report.
Gate Gourmet submit in reply that the Delegate’s decision is consistent with authority in the area and Ms Arifagic has failed to establish that an error of law has been made.
I am satisfied that it was an error of law for the Delegate to overlook relevant material and accordingly it is appropriate that I make such determination in relation to the application as in my opinion should have been made by the Delegate (Clause 119 of the Regulations).
When considering the additional contents of the report from St George, I am not satisfied that it was reasonable to obtain a further statement from Ms Arifagic when the former solicitor had already obtained a statement from her (Berger’s case, paragraph 142).
The Vocational Assessment Report was prepared by Janelle Brown, licensed investigator, and I do not consider this reasonable having regard to her lacking the qualifications and expertise for this type of report.
The Factual and Liability Summary is 4 pages in length and appears to be a summary of the medical reports and Ms Arifagic’s statement, rather than a report based on investigations conducted by the investigator.
I agree with the Delegate that the other items contained in St George’s report could have been obtained by Ms Arifagic’s solicitor. Accordingly I am not satisfied that it was reasonable to brief a factual investigator and I disallow the claim under this Item.
Item 2.06
Item 2.06 allows $250 per hour up to a maximum of $500 (at the relevant time) for ‘requesting a review of the claim from the insurer, prior to referral to the Commission’. Ms Arifagic’s solicitor in the bill of costs claimed $500. In the Determination the Delegate allowed an amount of $125 having regard to the contents of the letter requesting the review.
On appeal it is submitted that Item 2.06 refers to more than just writing a letter, as it involves working out an “opening offer” and obtaining instructions from Ms Arifagic.
I see no error of law or discretion on the part of the Delegate. The letter dated 6 January 2004 which is relied on as the basis for seeking a review, is 2 pages in length and simply sets out the lump sum claim based on a medical report which is enclosed. The remainder of the letter is pro-forma in style and the correspondence and its preparation could easily be dealt with in the half hour allowed by the Delegate.
Item 4.03B
Item 4.03A allows $40 per person served with a direction for production of documents up to a maximum of $200.
Item 4.03B allows $40 ‘…conduct money to person served with direction for the production of documents (being money to meet reasonable expenses of compliance with the direction)’. The money allowed per person is ‘regardless of the number of directions served on the person’. The maximum allowed for the Item is $200.
In the bill of costs Ms Arifagic’s solicitor claimed $200 for Item 4.03A and $168 for Item 4.03B. In response to the bill of costs Gate Gourmet agreed to the amount of $200 for Item 4.03A and made no submission in reply to Item 4.03B.
In the Determination the Delegate noted the agreement of the parties as to Item 4.03A.
In response to Ms Arifagic’s claim of $168 for Item 4.03B, the Delegate allowed $200 (plus GST) stating that this amount was conceded by Gate Gourmet. On appeal Ms Arifagic’s solicitor properly concedes that the Delegate erred at law because only $168 was paid for conduct money.
Clearly Ms Arifagic’s solicitor is correct as the Delegate appears to have transposed the response by Gate Gourmet to Item 4.03A when considering Item 4.03B.
Accordingly the amount for Item 4.03B will be reduced by the sum of $35.20 (inclusive of GST).
Item 4.07
This Item allows a maximum amount of $100 for ‘applying to refer a matter to an approved medical specialist or responding to such an application…’. In the Application for Assessment of Costs Ms Arifagic sought the sum of $100 for referral to an approved medical specialist. It was conceded that the referral occurred during a teleconference and the Delegate disallowed the claim for that reason. The Delegate further stated when the referral is during a teleconference it “must be absorbed into Item 4.09”.
On appeal it is submitted that Item 4.09 refers to ‘attending and participating in a conference with an Arbitrator’ and therefore the Delegate erred at law. I do not agree with this submission. As Deputy President Fleming stated in Berger’s case:
“108.The first point to make about Item 4.07 is that the activity it describes must in fact be undertaken by the legal representative in order to claim the cost. Where an application to refer a matter to an AMS is made in the course of a telephone conference, without any evidence of other activity by the legal representative, then Item 4.07 is effectively subsumed into Item 4.09.”
Item 4.08
This Item provides a maximum amount of $500 (at the relevant time) for ‘preparing for a conference (including providing advice to client)’. Ms Arifagic’s solicitor claimed $550 for the first teleconference and $275 for the second teleconference. The Delegate allowed the maximum amount of $500 for the first teleconference and nil for the second teleconference, as the maximum amount had already been allowed.
On appeal it is submitted that it is an error of law to limit the costs recoverable to one conference, or two, when that is not provided for in the Regulations. I do not agree with this submission. As Deputy President Fleming stated in Orr’s case:
“The monetary values set out in Column 4 of the Table, are the maximum total for an event type in any particular claim, regardless of the number of individual activities that may take place under that event heading.”
It is further submitted on appeal that Ms Arifagic is entitled to $550 as claimed and not $500 as determined by the Delegate. In support of this submission reference is made to the increase in amounts for various Items, including Item 4.08, in Schedule 6 of the Regulations. These increases resulted from amendments to the Regulations by the Workers Compensation Amendment (Costs in Compensation Matters)Regulation 2006 which came into operation on 17 March 2006.
Ms Arifagic’s solicitor correctly states that the increased rates apply having regard to the date of the Certificate of Determination in the substantive proceedings (Woodbury v Miles [2006] NSWWCCPD 55).
As noted above the Amended Certificate of Determination in the substantive proceedings in this matter was issued on 27 February 2006, which was before the amendment to the Regulations came into effect (17 March 2006). Accordingly the Delegate was correct in allowing the sum of $500.
Item 4.09
This Item allows $250 per hour, up to a maximum of $1,000, for ‘attending and participating in a conference with an Arbitrator (other than an arbitration hearing or where Item 4.10 applies)’.
Ms Arifagic claimed $687.50 for a total of two and a half hours and the Delegate allowed $625 for two and a half hours.
On appeal it is submitted that Ms Arifagic is entitled to the additional 10% increase having regard to the amendments to the Regulations referred to above in paragraph 46.
For the reasons stated in paragraph 47 the increased amounts do not apply and accordingly I see no error on the part of the Delegate.
Item 4.12
This Item provides for a maximum amount of $190 (at the relevant time) for ‘reporting to the client on the outcome of a conference or arbitration’. Ms Arifagic’s solicitor claimed the sum of $190 for reporting to the client after the first teleconference on 23 February 2005 and a further $190 for reporting to the client after the second teleconference on 20 February 2006. The Delegate allowed only $190 on the authority of Orellana-Fuentes v Standard Knitting Mill Pty Ltd (2003) 57 NSWLR 282 (‘Fuentes’).
In McManus v Gosford City Council [2004] NSWWCCPD 61 (‘McManus’) Deputy President Fleming followed Fuentes and determined that so far as Item 4.12 is concerned, the maximum amount of $190 may be allowed after the telephone conference and a further $190 allowed after the conciliation/arbitration.
There was no conciliation/arbitration in this matter which as I stated above resolved after the second teleconference. In accordance with the decision of McManus I can see no error of law or discretion on the part of the Delegate.
Item 10.01
The Table (at the relevant time) allowed a maximum amount of $187.50 under this Item for ‘all work associated with instructing an agent to act on the claim or a matter relating to the claim’.
Ms Arifagic’s solicitor claimed the sum of $206.25 for instructing an agent to inspect and photocopy documents on their behalf. The Delegate disallowed the claim stating; “I have disallowed the claim for the Agents fees and therefore this Item is also disallowed”.
On appeal Ms Arifagic submits that failure to provide adequate reasons constitutes an error of law. I agree with this submission having regard to the authority of Orr’s case which I have referred to above in paragraph 22. Accordingly it is necessary that I determine the matter (Clause 119 of the Regulations).
No specific details are provided by Ms Arifagic’s solicitor as to when inspection and photocopying of documents was carried out by the agent. Nonetheless I note that Ms Arifagic has recovered the maximum amount for Item 4.05 which refers to, among other things, reviewing documentation produced under direction of the Commission. To allow Ms Arifagic’s solicitor to recover fees paid to an agent for the inspection and photocopying of documents in addition to costs under Item 4.05 would involve recovery of an amount exceeding the maximum (Dunn v Port Macquarie RSL Club Ltd [2004] NSWWCCPD 33).
Accordingly I disallow the claim under Item 10.01.
Disbursements
Medical Report
In the bill of costs Ms Arifagic claimed $1,237.50 (inclusive of GST) for a medical report from Dr Lewin, psychiatrist. The report is dated 27 October 2004. The Delegate allowed the sum of $875 in accordance with the Workplace Injury Management and Workers Compensation (Medical Examinations and Reports) Order 2003 (‘the Order’). This Order sets out the rates for medical assessments by doctors in accordance with Section 339 of the 1998 Act.
On appeal Ms Arifagic submits that the Delegate is not constrained by the Legal Professional Regulation 2002 for the costs of medical reports. This submission fails to take into account the Order which came into effect on 4 November 2003. It has since been repealed and replaced by a further Order which came into effect from 18 March 2005.
As the medical report of Dr Lewin was subject to the 2003 Order, the amount allowed for a psychiatrists report by an independent medical specialist is $875.
The Delegate in allowing the sum of $875 made no adjustment for GST. The 2003 Order specifically states that the amounts allowed are exclusive of GST. Accordingly Ms Arifagic is entitled to $962.50 (inclusive of GST) and the Delegate’s Determination will be amended accordingly.
Private Investigator’s Fee
In the Application for Assessment of Costs, Ms Arifagic claimed the sum of $3,207.71 as a disbursement to cover the cost of a report from St George. The Delegate disallowed the claim for the reasons I have set out above under the sub-heading Item 2.05.
Having regard to my conclusion that the Delegate overlooked certain material in the private investigator’s report it is necessary that I make a determination as to this disbursement. Consistent with my reasons regarding Item 2.05 I am not satisfied that it was reasonable for Ms Arifagic’s solicitor to obtain the private investigator’s report and accordingly I disallow the claim for this disbursement.
DECISION
As a result of my review the Delegate’s determination in relation to disbursements is amended as follows:
·Item 4.03B; less $35.20 (inclusive of GST);
·Medical report; an additional $87.50 (being GST).
The Delegate’s determination of $7,862 is therefore increased by $52.30 to $7,914.30.
The Delegate’s determination is also amended at paragraph 1 to read: Amended Certificate of Determination on 27 February 2006.
The Registrar’s determination of a Claim for Costs in this matter, dated 22 August 2006 is amended in accordance with these reasons.
COSTS
Gate Gourmet seeks costs in the appeal, however I am not satisfied that the claim was frivolous or vexatious, fraudulent or made without proper justification and accordingly I make no order as to the costs of this appeal.
Julian Martin
Acting Deputy President
13 April 2007
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF JULIAN MARTIN, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
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