Freeburn v Colin R Odewahn t/as Bernley Pastoral Company

[2006] NSWWCCPD 304

WORKERS COMPENSATION COMMISSION

APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS

CITATION:Freeburn v Colin R Odewahn t/as Bernley Pastoral Company [2006] NSWWCCPD 304

APPELLANT:  William Roy Freeburn

RESPONDENT:  Colin R Odewahn t/as Bernley Pastoral Company

INSURER:CGU Workers Compensation (NSW) Ltd

FILE NUMBER:  WCC8360-05

DATE OF REGISTRAR’S DECISION:             1 November 2005

DATE OF APPEAL DECISION:  13 November 2006

SUBJECT MATTER OF DECISION: Appeal against Registrar’s decision in relation to costs; fee for private investigator’s report; claims under Items 2.06 and 10.01 of the Compensation Costs Table in Schedule 6 of the Workers Compensation Regulation 2003

PRESIDENTIAL MEMBER:  Acting Deputy President Robin Handley

HEARING:On the papers

REPRESENTATION:  Appellant: McCabe Partners Lawyers

Respondent: Abbott Tout Lawyers

ORDERS MADE ON APPEAL:  The Registrar’s determination of Mr Freeburn’s claim for costs in this matter, dated 1 November 2005, is amended in accordance with these reasons.

The Respondent, Colin R Odewahn t/as Bernley Pastoral Company, is to pay the Appellant, Mr Freeburn $275.00 inclusive of GST in respect of his costs in this appeal.

BACKGROUND TO THE APPEAL

1. On 25 November 2005, William Freeburn filed an appeal against a costs determination made by the Registrar of the Workers Compensation Commission (‘the Commission’) on 1 November 2005. The Respondent to the appeal is Colin R Odewahn t/as Bernley Pastoral Company (‘Bernley’) and Bernley’s workers compensation insurer is CGU Workers Compensation (NSW) Ltd (‘CGU’). On 20 December 2005, Bernley filed their ‘Notice of Opposition’ to the appeal but declined to make any submissions in relation thereto.

1. Mr Freeburn was born on 23 April 1945 and is aged 61. Mr Freeburn suffered an injury to his neck, left and right arms, back and left leg as a result of the nature and conditions of his employment as a shearer with Bernley in the period until 12 October 2001. Mr Freeburn claimed workers compensation in respect of his injury, the matter was heard in the Compensation Court of NSW and, on 5 September 2003, Judge Johns ordered Bernley to pay compensation to Mr Freeburn for permanent impairment, pain and suffering and medical expenses.

1. By letter dated 26 March 2004, Mr Freeburn’s solicitors wrote to CGU claiming weekly compensation. On 31 May 2004, the Commission registered Mr Freeburn’s ‘Application to Resolve a Dispute’. Bernley’s ‘Reply’ was filed on 25 June 2004. At a teleconference conducted by an Arbitrator on 30 August 2004, the parties came to an agreed resolution of the issues in dispute, and the Arbitrator issued a Certificate of Determination in the following terms:

“1. That the Respondent pay the Applicant weekly compensation at the statutory rate applicable for a single person with no dependants from 6 September 2003 to date under s 40 of the Workers Compensation Act 1987.

2. Such weekly payments to continue in accordance with the provisions of the Act.

3. That the Respondent pay the Applicant’s costs as agreed or assessed.”

1. The parties being unable to agree to the costs payable, on 1 June 2005, Mr Freeburn’s solicitors lodged an ‘Application for Assessment of Costs’ with the Commission in respect of their Bill of Costs dated 2 September 2004. On 11 July 2005, Bernley filed their response.

1. The Registrar delegated the assessment to a (different) Commission Arbitrator who made a determination dated 1 November 2005. The Certificate of Determination stated:

“1. Pursuant to a Certificate as to Determination issued on 30 August, 2004 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 $4,045.70 inclusive of GST.

3. The Applicant’s costs of the assessment are assessed at $550.00 inclusive of GST.

4. The Respondent is to pay the amount of $4,595.70 inclusive of GST to the Applicant if those costs have not already been paid.”

ISSUES IN DISPUTE

1. Mr Freeburn’s solicitors submit that the Arbitrator made errors of law in disallowing their claim for the following: professional costs claimed under Items 2.06 ($500.00 plus GST) and 10.01 ($187.50 plus GST), and the balance of a disbursement for a private investigator’s report ($967.95). The total amount in dispute is $1,724.20, inclusive of GST.

ON THE PAPERS REVIEW

1. Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) states:

“(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.”

1. Having regard to Practice Directions Numbers 1 and 6, the documents before me, and the submission by Bernley’s solicitors that the matter can be heard ‘on the papers’, Mr Freeburn’s solicitors having made no submission on this issue, I 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. 

1. No application to adduce fresh evidence was made.

SUBMISSIONS, DISCUSSION AND FINDINGS

1. The relevant legislation concerning appeals to the Commission against an assessment of costs, set out in the 1998 Act and the Workers Compensation Regulation 2003 (‘the 2003 Regulation’), has recently been discussed by Deputy President Fleming in Berger v Moree Plains Shire Council [2005] NSWWCCPD 152 (‘Berger’). I note, in particular, that clause 119(1) of the 2003 Regulation limits the grounds on which an appeal may be made against the decision of the Registrar on an assessment of costs “to a matter of law” arising in the proceedings to determine the costs application. Where the exercise of the Registrar’s or her delegate’s discretion in determining what is fair and reasonable is challenged, only where that discretion has miscarried because it has been exercised unfairly or unlawfully would this constitute an error of law: Nebauer v Hunter Area Health Service [2004] NSWWCCPD 60 (‘Nebauer’), at paragraph 19; Berger, at paragraph 136.

1. Clause 84 of the 2003 Regulation fixes the maximum costs recoverable by legal practitioners and agents at those set out in Schedule 6, except where otherwise provided in Part 19. Schedule 6 sets out the maximum costs recoverable in workers compensation matters by reference to the Compensation Costs Table (‘the Table’) at the end of the Schedule. The Table identifies particular activities or events with an item number. It is these item numbers that are referred to below.

1. Mr Freeburn’s solicitors submit the Arbitrator made an error of law by ignoring relevant material. This claim is discussed below.

Professional Costs

Item 2.06

1. With regard to Item 2.06 (described in the Table as “requesting a review of the claim from the insurer, prior to referral of the matter to the Commission”), Mr Freeburn’s solicitors state that the Arbitrator did not refer to their letter dated 26 March 2004, by which they sought a review of their client’s claim from CGU. A similar letter, dated 25 March 2004, was sent to Bernley. Mr Freeburn’s solicitors submit they are entitled to the $500.00 claimed under this Item.

1. The Arbitrator stated:

“The Applicant has not provided any evidence of a request for a review of the claim from the Insurer. The Applicant’s submission contains details of the gathering of information prior to or following the lodgement of the claim. As there is no evidence of a request for a review then this Item is disallowed.”

1. I agree with Mr Freeburn’s solicitors that there was evidence of the letter seeking a review, which was attached to the ‘Application to Resolve a Dispute’, and the Arbitrator erred by not allowing their claim for $500.00 (plus GST) under this Item.

Item 10.01

1. This Item is described in the Table as: “All work associated with instructing an agent to act on re: claim or a matter relating to the claim”. Mr Freeburn’s solicitors claimed $187.50 under this Item in respect of “All work associated with instructing an agent to act on re: claim”. In their submissions to the Arbitrator they stated: “The Applicant claims that it forwarded a letter to St George Registration and Investigation Services Pty Ltd (‘St George’) on numerous occasions and requested them to attend at the Workers Compensation Commission to obtain photocopies of the documents produced.” Bernley submitted: “as the instructing of agents to inspect documents produced under Direction is not claimable, we refer to Fitzpatrick v NSW TAFE Commission”.

1. The Arbitrator disallowed the claim, commenting: “The cost of an agent photocopying documents produced on Direction is to be absorbed in Item 4.05. See Dunn v Port Macquarie RSL Club Ltd [2004] NSWWCCPD 33.”

1. I note the Arbitrator allowed Mr Freeburn’s solicitors’ claim for $500.00 under Item 4.05 in respect of “Reviewing documentation provided under direction, exchanging information with other parties and obtaining further instructions”, which almost exactly equates with the description of the activity/event in column 2 of the Table for this Item. In Dunn v Port Macquarie, at paragraph 41, Deputy President Fleming held that Item 4.05 encompassed the copying of documents produced under direction. I am not therefore satisfied that the Arbitrator erred in disallowing Mr Freeburn’s solicitors’ claim in respect of instructing an agent to undertake this activity.

Disbursement

1. Mr Freeburn’s solicitors claimed the balance of a disbursement for a private investigator’s report ($967.95). In their Bill of Costs, they claimed $1,467.95 in respect of St George’s fee for preparing a factual and liability summary report. The Arbitrator said Nebauer:

“prevents the Applicant from obtaining the cost of instructing an Investigator to obtain a statement from the Applicant and I will only allow an amount of $500.00 for the Investigator’s fees being the cost of obtaining a Statement from Janette Jean Freeburn and details of the Applicant’s earnings.”

1. I note that in Berger at paragraph 142, Deputy President Fleming said:

“The fee for an investigator’s report, whether to obtain witness statements or other factual investigations (including a statement from the worker), may be claimed pursuant to clause 82(b) of the WC Regulation. The test of whether such a report is claimable will, as discussed above, essentially be one of ‘reasonableness’. In most cases it will not be reasonable to obtain witness statements by way of an investigator’s report, where the legal practitioner or agent has already obtained those statements, either at the time of taking instructions or at a later time, being before an application to the Commission is filed.”

1. In my view, there is nothing to suggest that the Arbitrator exercised his discretion unfairly or unlawfully in only awarding $500.00 in respect of this disbursement. In terms of the work undertaken by St George set out in their report, to which the Arbitrator referred, this appears to be entirely reasonable. I therefore reject the appeal in relation to this disbursement.

Summary

1. The outcome of my review of the Arbitrator’s decision in relation to the professional costs and the disbursement challenged by Mr Freeburn’s solicitors is as follows:

Professional Costs
• Item 2.06: it would have been fair and reasonable for the Arbitrator to allow $500.00 (plus GST of $50.00, gives a total of $550.00) for requesting a review of the claim from the insurer.
• Item 10.01: the Arbitrator’s disallowance of this claim is confirmed.

Disbursement
• Private investigator’s report: the Arbitrator’s decision to award only $500.00 in respect of the fees claimed is confirmed.

1. The Arbitrator’s award of $4,595.70 should, therefore, be increased by $550.00 to $5,145.70.

DECISION

1. The Registrar’s determination of Mr Freeburn’s claim for costs in this matter, dated 1 November 2005, is amended in accordance with these reasons.

COSTS

1. Mr Freeburn’s solicitors have been only partially successful in this appeal. In my view, it is reasonable to order that Bernley pay Mr Freeburn’s costs in this appeal in the sum of $275.00 inclusive of GST, representing the equivalent of approximately one hour of work. The appropriate order, therefore, is: “The Respondent, Colin R Odewahn t/as Bernley Pastoral Company, is to pay the Appellant, Mr Freeburn $275.00 inclusive of GST in respect of his costs in this appeal.”

Robin Handley

Acting Deputy President  

13 November 2006

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBIN HANDLEY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE