Griffiths and Australian Postal Corporation

[2006] AATA 965

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 965

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2005/899

GENERAL ADMINISTRATIVE DIVISION		)
Re		GEOFFREY GRIFFITHS

Applicant

And AUSTRALIAN POSTAL CORPORATION

Respondent

DECISION

Tribunal  Senior Member M D Allen

Date of Decision  15 November 2006

Place  Sydney

DecisionThat each party pay their own costs.

(Sgd) M.D. ALLEN
  ..................................................
  Senior Member

CATCHWORDS

COSTS – reviewable decision set aside – whether the Respondent should pay the Applicant’s costs – offer of compromise made by the Respondent – effect of the “Calderbank letter” – discussion of the decision before the Tribunal subject to review – notwithstanding that the Applicant has succeeded each party is to pay its own costs.

Safety, Rehabilitation and Compensation Act 1988 ss 14, 67

Calderbank v Calderbank [1976] Fam 93

Perry v Comcare (2006) 150 FCR 319

Lees v Comcare (1999) 29 AAR 350

REASONS FOR DECISION

Senior Member Allen         

1. On 10 November 2006, I decided that a reviewable decision made on 23 June 2005 should be set aside and the Respondent was liable pursuant to s 14 of the Safety, Rehabilitation and Compensation Act 1988, for a temporary exacerbation of symptoms caused by the Applicant’s cervical spondylosis.

2.      The Respondent submitted that notwithstanding the setting aside of the reviewable decision, the Tribunal in the exercise of its discretion, ought not to order that the Respondent pay the Applicant’s costs. Any order for costs could only be made pursuant to ss 67 (8) SRC Act which reads:-

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

(a)varying a reviewable decision in a manner favourable to the claimant; or

(b)setting aside a reviewable decision and making a decision in substitution for the reviewable decision 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.      The Respondent’s submissions were based on an offer of compromise forwarded to the Applicant’s solicitors.  That letter was in the form of what has become know as a “Calderbank letter”(Calderbank v Calderbank [1976] Fam 93) and requested acceptance by 31 August 2006 – a date 16 days after the letter and draft terms of an agreement had been forwarded to the Applicant’s solicitors by facsimile.

4.      That such an offer of compromise can be considered by the Tribunal in deciding whether costs might be withheld from an otherwise successful Applicant was made clear by the judgment of the Federal Court in Perry v Comcare (2006) 150 FCR 319.

5.      The criteria for determining whether a Calderbank letter is to be taken into account on the question of costs is that the letter is clear, precise and certain, particularly with regard to costs.  See the discussion at 150 FCR at pages 327 and 333-5. In this matter the letter and accompanying consent terms are in my view, when read together entirely clear.

6.      No reply was received to the letter of compromise.  In particular there was no counter offer.

7.      Under the proposed terms of settlement, the Respondent accepted liability for “aggravation to his cervical spine” and for medical treatment and loss of wages up to 8 June 2005.  A further term of the proposed agreement was that liability ceased as at 9 June 2005.

8. The proposed agreement which was to found a consent decision of the Tribunal pursuant to s 42C of the Administrative Appeals Tribunal Act 1975 was not a decision that could in fact have been made by the Tribunal.

9.      As was pointed out in Lees v Comcare (1999) 29 AAR 350, the Tribunal on review of a reviewable decision made under s 62 SRC Act, can not exercise any powers or discretions which were not available to the determining authority making the reviewable decision, notwithstanding that wider powers and discretions might have been available to the original decision maker.

10. Thus in this matter the Applicant’s original claim on 27 April 2005 was for “neck pain and muscular pain”. On 20 May 2005, a delegate of the Respondent determined that liability under s 14 of the Act did not exist for the Applicant’s claim of neck and muscular pain. On 23 June 2005, a reviewable decision affirmed the prior determination of 20 May 2005.

11.     The Reviewable Decision read:

‘Having regard to the evidence before me and pursuant to s 62 of the above Act, I hereby AFFIRM the decision of the delegate dated 20 May 2005. I determine that Australia Post is not liable to pay compensation in relation to your current condition of neck and muscular pain.’

12.     In conformity with Lees v Comcare supra, the only decision before the Administrative Appeals Tribunal, was the decision as to whether or not pursuant to s 14 SRC Act, the Respondent was liable to pay compensation to the Applicant for his neck and muscular pain. The quantum of any compensation to be paid, and under what provisions of Part II Division 1 SRC Act, was not before the Tribunal.

13.     That the offer of compromise was made in the terms it was, occurred no doubt because of issues raised in the Applicant’s Statement of Facts and Contentions which was filed with the Tribunal on 16 June 2006. In that document the Applicant, who was by then represented by solicitors, claimed ongoing medical expenses and loss of income up to 20 November 2005.  In addition, claims were made in relation to a prior injury which had occurred in 1996.  The Respondent, in its Statement of Facts and Contentions, denied that any symptoms suffered by the Applicant in April 2005 were causally related to his employment.

14.     As stated above, it is quite clear that the only matter before the Tribunal was liability simpliciter and that the other claims made in the Applicant’s Statement of Facts and Contentions were irrelevant to the current proceedings.

15.     Paradoxically the decision that was in fact made by the Tribunal is more favourable to the Applicant than the proposed offer of compromise.  That occurs because the settlement offer related to a closed period and liability for the aggravation was to cease as at 8 June 2005. The decision of the Tribunal leaves it open for the Applicant to make a claim that the compensable effects of the aggravation continued post 8 June 2005.

16.     Notwithstanding this result, it should have been obvious to the Applicant’s solicitors that the claims in the Statement of Facts and Contentions went beyond the decision under review.  Having received the Respondent’s offer and having been served with a copy of the report by Dr Olsen, an agreement to accept liability for an aggravation of cervical spondylosis could and should have been made.  A decision in those terms would then have enabled the Applicant to make subsequent claims for other heads of compensation, for example medical expenses and loss of income.

17.     To my mind, the proposed offer of compromise was not one that could have been accepted by the Applicant or by the Tribunal as it exceeded the parameters of the decision under review.  In these circumstances, the Calderbank letter was of no effect.

18.     As Perry v Comcare supra makes clear, the existence of a valid Calderbank letter is not the only basis upon which the Tribunal may exercise its discretion to refuse a successful party its costs.

19. In this matter, the hearing occupied some 2 ½ days, yet it was obvious at the outset that the only decision before the Tribunal subject to review, was the decision to deny liability pursuant to s 14 SRC Act.

20.     Whereas the Applicant has succeeded, the decision of the Tribunal is in terms far more restricted than the decision sought in the Applicant’s Statement of Facts and Contentions.  In these circumstances, my view is that each party should pay its own costs.  That is to say there will be no order that the Respondent pay the Applicant’s costs.