Boccanfuso and Australian Postal Corporation

[2008] AATA 912

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 912

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No. N2006/1368

GENERAL ADMINISTRATIVE DIVISION		)
Re		ALFRED BOCCANFUSO

Applicant

And AUSTRALIAN POSTAL CORPORATION

Respondent

DIRECTION

Tribunal

Senior Member M D Allen

Dr M E C Thorpe, Member

Date13 October 2008

PlaceSydney

Decision Pursuant to subsection 67(8) of the Safety, Rehabilitation and Compensation Act1988 the Respondent is to pay to the Applicant his costs on a party/party basis up to and including the 17th day of July 2008.

................[sgd]..............................

M D Allen

Senior Member

CATCHWORDS –WORKERS’ COMPENSATION – Practice and Procedure – Calderbank letter – Was the applicant to be deprived of his costs post receipt of an offer of compromise – Costs denied from 14 days after offer. 

LEGISLATION

Safety, Rehabilitation and Compensation Act 1988 – ss 16, 19, 67(8)

CASES

Calderbank v Calderbank (1976) 3 All ER 333

Perry v Comcare (2006) 150 FCR 319

Griffiths v Australian Postal Corporation [2008] FCA 19

Boccanfuso and the Australian Postal Corporation [2008] AATA 797

Comcare v Mathews (1999) 29 AAR 350

REASONS FOR DECISION

13 October 2008

Senior Member M D Allen

Dr M E C Thorpe, Member

1.      On 9 September 2008 this Tribunal set aside a reviewable decision and determined that the Respondent was liable to pay compensation to the Applicant for a work-caused injury to his right shoulder.  (See Re Boccanfuso and Australian Postal Corporation [2008] AATA 797). The injury occurred on 15 September 2003 and we further determined that the said injury had resolved by 30 October 2003.

2.      Although we determined that the Respondent was to pay the Applicant’s costs, we did not specify under which subsection of section 67 of the Safety, Rehabilitation Compensation Act 1988 (“SRC Act”) costs were to be awarded. Subsection 67(8) SRC Act states inter alia:

“Where, in any proceedings initiated by the claimant, the Administrative Appeals Tribunal makes a decision:

(a) …

(b)     setting aside a reviewable decision and making a decision substitution for the reviewable that is more favourable to the claimant than the reviewable decision;

the Tribunal may, subject to this section, order that the costs of those proceedings incurred by the claimant, or a part of those costs, shall be paid by the responsible authority”. 

3.      Following the Tribunal’s decision the Respondent’s solicitor made submissions that the Applicant’s costs should not be awarded on a strict party/party basis, but that the Applicant should be entitled to 50 per cent only of his costs after 13 September 2007 and receive no costs as and from 3 July 2008.

4.      The basis of the Respondent’s submission was that two letters forwarded by the Respondent’s solicitors to the Applicant’s solicitors, namely on 13 September 2007 and 3 July 2008, were valid offers of settlement in terms of Calderbank v Calderbank (1976) 3 All ER 333.

5.      That the principles enunciated in Calderbank v Calderbank supra apply to proceedings before the Administrative Appeals Tribunal in which review is sought of decisions made under the SRC Act was made clear by the decision of the Federal Court in Perry v Comcare (2006) 150 FCR 319.

6.      The reviewable decision dated 5 October 2006 which was the subject of proceedings before this Tribunal, denied liability under s 14 SRC Act in respect of an injury that occurred on 15 September 2003.

7.      The Respondent’s solicitor’s letter of 13 September 2007 offered to accept liability for a “temporary right shoulder strain” and to accept liability for medical expenses and any loss of income for a closed period between 15 September 2003 to 25 September 2003 inclusive. 

8. In his statement of facts and contentions dated 28 September 2007 the Applicant sought to have the determination of his entitlements, pursuant to sections 16 and 19 SRC Act, remitted to the Respondent for determination. It was only after having heard submissions by both parties that we proceeded to determine any liability under sections 16 and 19 SRC Act in the proceedings before us. As pointed out in Boccanfuso and the Australian Postal Corporation [2008] AATA 797 at paragraphs 22 and 23, the finding that the Applicant had a compensable injury was enough to set aside the reviewable decision, and strictly speaking the Tribunal did not have jurisdiction to entertain any submissions regarding sections 16 and 19 SRC Act, as the reviewable decision did not deal with the question of what compensation (if any) was to be paid pursuant to those sections of the SRC Act. (Cf Comcare v Mathews (1999) 29 AAR 350).

9.      In our opinion the Applicant was, as at 13 September 2007 and to the date this matter first came on for hearing namely 16 April 2008, entitled to reject the offer contained in the letter of 13 September 2007.  He may legitimately have thought that if the decision of the Tribunal was to set aside the decision under review, he may have achieved a more favourable result upon further internal review by the Respondent.

10.     At the conclusion of the hearing on 16 April 2008 all the evidence had been taken, and all that remained were addresses by the respective counsel.  Prior to the matter coming on for the resumed hearing on 1 August 2008, a directions hearing had been held on 22 July 2008 when the effect of the evidence of Dr McGill and Associate Professor Sambrook was canvassed with the parties.

11.     Prior to that directions hearing, and of course unknown to the Tribunal, the Respondent’s solicitor had written to the Applicant’s solicitors offering to settle the matter, on the basis that the Applicant suffered incapacity from a work caused injury for the period 15 September 2003 to 30 October 2003.  This letter forms the basis of the second application regarding the principles in Calderbank v Calderbank.

12.     We find that the letter of 3 July 2008 conformed to the requirements of a “Calderbank” letter as to which see Perry v Comcare supra at pages 327 and 333-335.

13. That the letter went further and referred to claims pursuant to sections 16 and 19 SRC Act does not constitute the offer an invalid one. This point was expressly determined by Madgwick J in Griffiths v Australian Postal Corporation [2008] FCA 19. 

14.     As at 3 July 2008 all evidence was in, and it should have been apparent to the Applicant that the Respondent was determined to make an offer in regard to a closed period only.  In particular, both parties had had access to the clinical notes of the treating medical practitioner Dr Sim.

15.     We find that as 3 July 2008 the Applicant’s solicitors were in a position to realistically consider the offer made.

16.     The decision that was obviously made by the Applicant’s solicitors was to reject the offer of compromise as contained in the letter of 3 July 2008.  The decision of the Tribunal was not more favourable to the Applicant than the terms as contained in that letter.  That the letter was in terms of Calderbank v Calderbank was clearly spelt out.

17.     In these circumstances we see no reason why the letter of 3 July 2008 should not have its full effect.  It is entirely proper that realistic efforts should be made to settle matters before the Tribunal, and if parties feel free to ignore realistic offers of settlement then it should be clear that they do so at their peril.

18.     The Applicant has complained that the offer was made during the course of proceedings.  We see no reason why an offer of settlement during the course of a hearing (or trial) should not have an effect as to costs if the said offer is clear, precise, certain and capable of acceptance.

19. The order of the Tribunal will be that pursuant to ss 67(8) SRC Act the Respondent is to pay to the Applicant his costs on a party/party basis, up to and including 17 July 2008.

20.     We have nominated 17 July 2008 as the cut off date to include time for the receipt of the letter and time for the solicitors to consult with counsel and get instructions from their client.

I certify that the 20 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member M D Allen and Dr M E C Thorpe, Member.

Signed:         ..............[SGD]................................................................
  Associate

Date of Hearing  15 September 2008
Date of Decision  13 October 2008
Counsel for the Applicant         Mr D Richards
Solicitor for the Applicant          Slater & Gordon
Counsel for the Respondent     Mr P S Jones
Solicitor for the Respondent     Forners Solicitors & Consultants