Hancock v Riverend Park Pty Ltd

[2010] VSC 39

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

No. 5284 of 2009

GLENN HANCOCK	Plaintiff
v
RIVEREND PARK PTY LTD	Defendant

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JUDGE:	BEACH J
WHERE HELD:	Melbourne
DATE OF HEARING:	18 & 19 February 2010
DATE OF JUDGMENT:	23 February 2010
CASE MAY BE CITED AS:	Hancock v Riverend Park Pty Ltd
MEDIUM NEUTRAL CITATION:	[2010] VSC 39

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ACCIDENT COMPENSATION – Proceeding settled – Award of costs – Entitlement of solicitor to recover costs from worker – Accident Compensation Act 1985, ss 134AB(28), (30) and (31).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr T.P. Tobin SC with Mr I.D. McDonald	Shine Lawyers
For the Defendant	Mr R.J. Stanley QC with Mr A.W. Middleton	Minter Ellison

HIS HONOUR:

Introduction

1. On 22 September 2006, Mr Glenn Hancock, the plaintiff, was training a horse in the course of his employment with Riverend Park Pty Ltd, the defendant.  While performing this work, the horse fell back on him and rendered him a paraplegic.

1. On 25 March 2009, Mr Hancock, pursuant to s 134AB of the Accident Compensation Act 1985, commenced a proceeding against Riverend. Mr Hancock claimed that his injuries were caused by the negligence of Riverend.

1. The trial came on for hearing before a jury on 18 February 2010.  On the second day of trial, the parties compromised the proceeding on terms that the defendant agreed to pay the plaintiff $300,000, with the plaintiff retaining amounts totalling in excess of $455,000 paid pursuant to the provisions of the Accident Compensation Act.

1. The amount of the settlement is less than 90% of the plaintiff’s statutory counter offer made under s 134AB(12). By the operation of s 134AB(28)(b) of the Act, each party must bear its own costs. The solicitors for Mr Hancock, Shine Lawyers (“the solicitors”), have applied to the Court for an order (if one be necessary) that Mr Hancock pay their costs and disbursements fixed in the sum of $100,000. The solicitors have made this application on the basis that if s 134AB(30) has application to the circumstances of this case, then the solicitors are unable to recover any costs from Mr Hancock in the absence of an order of the Court.

1. For the reasons given below, I have concluded that the solicitors do not require an order under s 134AB(30).

Analysis

1. Section 134AB(30) of the Act provides:

“A person who represents or acts on behalf of a worker is not entitled-

(a)  to recover any costs from that worker in respect of any proceedings under this section; or

(b)  to claim a lien in respect of those costs; or

(c)  to deduct those costs from any sum awarded as damages-

unless an award of costs has been made by the court in respect of those costs or those costs are payable in accordance with this section by the worker.”

1. Section 134AB(30) prevents a worker’s solicitors recovering costs[1] unless either:

(a)an order for those costs is made by the Court; or

(b)those costs are payable by the worker (plaintiff) in accordance with s 134AB.

[1]Or claiming a lien or deducting costs.

1. The payment of costs in relation to proceedings brought pursuant to s 134AB is governed by s 134AB(28). Section 134AB(28) provides:

“In proceedings for the recovery of damages commenced in accordance with this section after a statutory offer was made, or deemed to have been made, under subsection (12) -

(a)  if no liability to pay damages is established, the worker must pay the party and party costs of the employer, Authority or self-insurer and the worker's own costs;

(b)  if judgment is obtained or a settlement or compromise is made in an amount not less than 90 per cent of the worker's statutory counter offer under subsection (12) and more than the statutory offer of the Authority or self-insurer, the Authority or self-insurer must pay the worker's party and party costs and its own costs;

(c)  if judgment is obtained or a settlement or compromise is made in an amount not more than the statutory offer of the Authority or self-insurer under subsection (12), the worker must pay the party and party costs of the Authority or self-insurer and the worker's own costs;

(d)  if judgment is obtained or a settlement or compromise is made in an amount that is more than the statutory offer of the Authority or self-insurer under subsection (12) but less than 90 per cent of the worker's statutory counter offer under that subsection, each party bears its own costs -

and the court must not otherwise make an order as to costs.”

1. The facts of this case are governed by s 134AB(28)(d). The issue is whether, in providing that the plaintiff must bear his own costs, the plaintiff’s costs are, in accordance with s 134AB, payable by the plaintiff.

1. This issue has been looked at before in the context of s 135A of the Act. Section 135A governs common law proceedings in respect of workplace injuries arising out of employment before 12 November 1997. Section 134AB covers the same field in respect of injuries arising in the course of employment on or after 20 October 1999. Sections 134AB(28) and (30) are the analogues of s 135A(13A) and (13C) respectively.

1. In Quama v Toll Transport Pty Ltd,[2] Gillard J held that s 135A(13C) had no application to a claim governed by s 135A(13A)(d) where the worker had recovered less than 90% of the worker’s statutory counter offer.  His Honour accepted a submission that the phrase “each party bears its own costs” was a convenient and correct way of stating the obligation of each party to pay his or her own costs.  Gillard J then concluded that those costs were “payable in accordance with this section [in that case, s 135A] by the worker”.  His Honour thus concluded that s 135A(13C) had no application to those facts.

   [2][2004] VSC 81.

1. Sections 134AB(28) and (30) being relevantly identical to ss 135A(13A) and (13C), there is no basis for distinguishing between the two cases. I agree with Gillard J’s analysis of s 135A.[3] It has application in this case. Because the plaintiff’s costs are payable by the plaintiff in accordance with s 134AB(28)(d), the solicitors are entitled to recover their costs without an award being made under s 134AB(30).

   [3]Although the statement in paragraph [18] that “the paragraphs (a) to (d) (inclusive) of sub-s 13A cover all the possible situations which may arise as a result of a judgment being obtained for a settlement or compromise being reached” should be read as only applying to cases where that sub-section has application (cf Acir v Frosster Pty Ltd [2009] VSC 539) and to cases not involving third parties (cf Spotless Services Australia Limited v Herbath [2009] VSCA 285).

1. It follows from what I have said above that no order under s 134AB(30) is necessary. However, on the basis that such an order might be necessary, I heard evidence from the plaintiff as to the advice he had received, the circumstances of the settlement and his consent to the proposed order. It is sufficient to say that, consistently with the principles set out by J. Forrest J in Acir v Frosster Pty Ltd,[4] I would have granted the application had it been necessary. The sum sought by the solicitors represents a significant discount from the amount they could have expected to receive on a solicitor/client taxation. I was told that this was brought about in part by the operation of ss 134AB(12), (25) and (28).[5]

   [4][2009] VSC 539.

   [5]As to the potential unfairness of which, see Raeburn v Tenix Defence Systems Pty Ltd (2007) 16 VR 290 at paragraphs [16]-[21].

1. For the sake of completeness, I should say that whilst s 134AB(31)[6] may have a stand-alone operation empowering the Court to determine the amount of costs irrespective of whether s 134AB(30) has application,[7] I was not asked to consider the matter on that basis. Further, as it appears that the solicitors and the plaintiff have agreed that $100,000 is an appropriate amount for costs and disbursements, there is no dispute between them requiring the making of an order under s 134AB(31).

   [6]Section 134AB(31) provides:

   [7]As to which, see the analysis of Gillard J in Quama (supra) at paragraph [24] and following.

Conclusion

1. For the reasons given above, the solicitors do not require an order under s 134AB(30) of the Act. Section 134AB(30) does not prevent the solicitors from recovering costs in this case.

“The court, on the application of-

(a)  the worker; or
   (b)  the person representing or acting on behalf of the worker -
may determine the amount of costs to be awarded to the person representing or
acting on behalf of the worker.”