Holman Webb Lawyers Pty Ltd v AAI Limited t/as GIO

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Holman Webb Lawyers Pty Ltd v AAI Limited t/as GIO [2023] NSWPIC 582
APPLICANT:	Holman Webb Lawyers Pty Limited
RESPONDENT:	AAI Ltd t/as GIO
PRINCIPAL MEMBER:	Glenn Capel
DATE OF DECISION:	3 November 2023
CATCHWORDS:	WORKERS COMPENSATION - Workers Compensation Regulation 2016; assessment of costs; consent judgment in Supreme Court against two defendants; GIO received partial payback of workers compensation payments; no damages paid by GIO; applicant seeks costs of $74,250 calculated on gross judgment in accordance with stage 6 of schedule 7; GIO offers stage 8 costs of $20,600 plus GST on basis that no settlement or damages paid by GIO; parties unable to reach agreement; Held – costs to be calculated in accordance with stage 8 of schedule 7 as no monetary damages paid by GIO; if stage 6 applied, the costs would be calculated on the balance of the unpaid payback, these costs being less that stage 8 costs; respondent ordered to pay $21,000 plus GST being the maximum payable for professional costs in accordance with stage 8 of schedule 7; applicant ordered to pay the respondent’s costs of the assessment of $1,200 plus GST.
DETERMINATIONS MADE:	The Commission orders: 1. The name of the applicant is amended to Holman Webb Lawyers Pty Ltd. 2. The name of the respondent is amended to AAI Ltd t/as GIO. 3. The respondent is to pay to the applicant’s costs in the sum of $21,000 plus GST within 28 days of this assessment. 4. The applicant is to pay the respondent’s costs of this assessment in the sum of $1,200 plus GST within 28 days of this assessment.

STATEMENT OF REASONS

BACKGROUND

Leslie Ryder (the claimant/plaintiff) was employed by Ready Workforce (A Division of Chandler Macleod) Pty Limited (Ready Workforce/second defendant) as a labourer. Ready Workforce supplied labour to Baiada Pty Ltd (Baiada/first defendant) at a farm in Tamworth where Baiada conducted its business.
During the course of his employment on 26 September 2016, the claimant sustained injuries to his face, eyes, head and developed anxiety and depression when a high pressure hose that he was using to clean contaminated surfaces slipped from his grasp. He has been unable to return to work following his injury.
Liability was accepted by the workers compensation insurer of Ready Workforce, AAI Ltd t/as GIO (GIO/respondent), and weekly compensation and medical expenses were paid. GIO also paid lump sum compensation in respect of 31% whole person impairment of the respondent’s visual system pursuant to s 66 of the Workers Compensation Act 1987 (the 1987 Act). The total of compensation paid was $253,753.02 less non-compensation payments of $27,000.28, giving a total of $226,752.74.
The claimant filed an Application for Mediation of a Work Injury Damages Claim (WID claim) in the Workers Compensation Commission (the Commission) in matter no. 2880/19 on
13 June 2019. GIO retained Holman Webb Lawyers Pty Ltd (the applicant) to act on behalf of Ready Workforce on 7 August 2018 and was instructed to appear at the mediation.
A mediation conference was conducted by Mediator Ireland on 20 August 2019. There was no appearance by or on behalf of Baiada who was not a party to the mediation.
In a Certificate of Mediation Outcome issued on 28 August 2019, the Mediator certified that the parties had failed to resolve the dispute and reach a settlement. He certified the final offers of the parties as $700,000 plus costs clear of workers compensation payments by the claimant and nil offer by the Ready Workforce.
The plaintiff had previously commenced proceedings in the Supreme Court in matter no 2019/298190 against Baiada. Following the mediation, Ready Workforce was joined to those proceedings as the second defendant. The applicant filed a defence on behalf of the second defendant.
On 16 September 2021 the solicitor for Baiada contacted the applicant’s solicitor, Mr Brown, and advised that the first defendant would pay the plaintiff $975,000 inclusive of costs and inclusive of a $100,000 recovery in favour of the second defendant. Mr Brown obtained instructions from GIO to agree to the terms of this proposed settlement. The plaintiff accepted the joint offer.
On 17 September 2021, a tax invoice was sent to GIO. On the same date GIO withdrew instructions from the applicant. Messrs Moray and Agnew were retained on behalf of the second defendant and GIO.
The tax invoice dated 17 September 2021 was as follows:
Fees For Services including:
To our professional costs in accordance with Workers Compensation Costs Regulations
·Schedule 7 Table A, Stage 5(a) INS7501A  $47,600
·Schedule 7, Stage 5(b)  $19,500
·Table Other, Stage 3 INS7501B  $400
Plus GST  $6,750
TOTAL AMOUNT OWING  $74,250
A Consent Judgment was executed between the parties on 26 October 2021 without the applicant’s involvement.
There was judgment in the plaintiff’s favour against the first defendant in the sum of $975,000 inclusive of statutory paybacks, costs and disbursement and workers compensation payments. This was satisfied by payment of $875,000 to the plaintiff and $100,000 to GIO.
There was also judgment for the plaintiff against the second defendant with each party to pay their own costs. The cross claims were dismissed with each party to pay its own costs.
On 11 November 2021, Mr Mulry of GIO questioned Mr Brown as to how costs could be paid at the level claimed because GIO had paid no damages. He suggested that costs of $20,600 would be payable. In response, Mr Brown maintained that the costs claimed were appropriate and the correct table had been applied.
On 21 December 2021, Mr Mulry confirmed that GIO’s position regarding costs remained the same. On 22 December 2021, Mr Brown informed Mr Mulry that he would be filing an Application for Assessment of Costs (the Application) in the Personal Injury Commission (Commission).

PROCEDURE BEFORE THE COMMISSION

On 3 October 2023, Mr Brown filed an Application in the Commission. On 26 October 2023, the matter was referred to me for assessment of costs of the applicant’s solicitors.
The applicant attached written submissions to the Application. The respondent’s solicitor,
Mr Harris, filed written submissions on 17 October 2023. On 26 October 2023, I directed the applicant to file submissions in reply and these were filed on 3 November 2023.
Given the nature of the claim, I have amended the identities of the parties to properly reflect the correct entities involved in this Application.

ISSUE FOR DETERMINATION

The parties agree that the following issue remains in dispute:
(a) assessment of the applicant’s costs.

EVIDENCE

I have reviewed the documents attached to the Application as well as the mediation file in matter no. 2880/19. This material has formed the basis of my comments above. I do not propose to summarise the evidence any further.

APPLICANT’S SUBMISSIONS

The applicant’s counsel, Mr Robinson, submits that there are four settlement categories, and the best fit for this matter was in category iv, namely, “Where the parties have entered into an agreement and do intend to be bound, but also agree to supplement that agreement with a formal document (binding)”.[1]
[1] Masters v Cameron (1954) 91 CLR 353.
Mr Robinson submits that there was a binding settlement between all three parties to the Supreme Court litigation on 16 September 2021. The plaintiff was to be paid $975,000 by the first defendant less the sum of $100,000 payable to the second defendant. This was formalised in the Consent Judgment. The nature of the settlement was clear. In the alternative, the terms of the Consent Judgment set out the terms of the settlement between the parties.
Mr Robison submits that the tax invoice issued by the applicant was calculated in accordance with Sch 7 of the Workers Compensation Regulation 2016 (the 2016 Regulation) albeit with a discrepancy referring to Stage 5 instead of Stage 6.
Mr Robison submits that costs in WID claims are regulated by the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) and that the applicant is entitled to be remunerated in accordance with the 2016 Regulation.
Mr Robison submits that Sch 7 of the 2016 Regulation sets out a scale for WID matters. He submits that Stage 6 applies because having reached settlement, the parties proceeded to file a Consent Judgment. The plaintiff succeeded in his claim against the second defendant. There was no capitulation which would have attracted the application of Stage 8.
Mr Robison submits that given what is effectively the definition of "settlement or an award" in cl1(5) of Sch 7 as being inclusive of workers compensation, this suggests that the quantification of legal fees refers to the total value of any given plaintiff's claim before credit is applied for weekly benefits paid in accordance with s 151A of the 1987 Act.
Mr Robison submits that Stage 8 applies in circumstances where there is a judgment in favour of a defendant or some other form of capitulation by a plaintiff. In this case, the plaintiff received a judgment in his favour.
Mr Robison submits that whilst GIO did not pay any money as part of the settlement, it did in effect contribute a monetary amount, because it agreed to forego the payment of about $150,000 of its compensation payments. This was clearly done in contemplation that it had some exposure to the claim. The only sum of damages referable for the calculations under the stages in Sch 7 of the 2016 Regulation is with respect to the sum in the Consent Judgment. GIO has not made any objection to this calculation.
Mr Robison submits that the word "judgment" does not appear in Sch 7 of the 2016 Regulation. The relevant concepts are settlements and awards of damages. Stage 6 applies in the present case. The matter was referred to mediation, the finalisation occurred after the commencement of court proceedings, and the matter was finalised by a settlement or an award of damages.
Mr Robison submits that Stage 8 excludes circumstances of a “settlement or an award of damages”. It is not applicable here because the plaintiff was paid damages as reflected in the reduction of the statutory credit to which the second defendant would be entitled were it not a tortfeasor. The Consent Judgment referred to payment by the defendants, consistent with an "award of damages" as contemplated by the 2016 Regulation especially in circumstances where it forms part of a judgment and is being "awarded" by the court.
Mr Robison submits that invoice issued by the applicant is correct and the Commission should assess costs in the sum of $74,250.
In his submissions dated 3 November 2023, Mr Robison submits that the plaintiff’s damages proceedings were finalised in circumstances which amounted to both “settlement” and an “award of damages”. The Consent Judgment was not meaningless and reflected a “settlement” as it arose from the consent of the parties to finalise the litigation. The gross award of damages demonstrated a statutory credit to GIO. There was no judgment for the second defendant. GIO made a financial contribution by forgoing some of its workers compensation payback. Workers compensation insurers do not require plaintiffs to pay back compensation with their payment of damages.
Mr Robison submits that there is a presumption of regularity in the Consent Judgment. It is not open to the respondent to submit that there was an error on the terms of the Judgment without setting it aside. This Commission has no jurisdiction to consider the correctness of Supreme Court judgments. There was not any error.
Mr Robison submits that there was a judgment in favour of the plaintiff. He received damages from both defendants. It is inconsistent for the respondent to contend that the Consent Judgment is meaningless in circumstances where it entered into that Judgment, by consent, on terms which it must have regarded as being in its best interests.
Mr Robison submits that it is impossible to determine after a settlement which portion of the plaintiff’s damages had the character of work injury damages and which did not. It falls to the respondent to disentangle those damages[2], and it has not attempted to do so, with the result that the amount claimed should be awarded. In the alternative, if this somehow be disentangled, costs should be assessed per Stage 6 of Sch 7 and be referrable to the disentangled amount.
[2] Dungan v Padash [2021] NSWCA 66

RESPONDENT’S SUBMISSIONS

The respondent’s solicitor, Mr Harris, submits that the correct amount payable for the applicant’s costs is $20,600 plus GST in accordance with Work Injury Costs Table A, Stage 8. There was no payment by the respondent of “damages”, a “settlement” or an “award”.
Mr Harris submits that there is reference to the term “damages” in ss 149(1) [sic] and 151G (1) of the 1987 Act and “work injury damages” is defined in s 250(1) of the 1998 Act. I will refer to these sections later.
Mr Harris submits that the applicant has based its entitlement to costs on the total judgment in favour of the plaintiff against the first defendant, but it is evident that no damages were paid by the second defendant by way of either a “settlement” or an “award”. The total settlement was paid by the first defendant. This outcome precludes Stage 6 and leaves Stage 8 as the only applicable stage. Further, it is clear from the wording of Stages 3, 4 and 5 that the effect and intent of the provisions is that they only apply where the employer has made a payment of work injury damages.
Mr Harris submits that not only did the respondent received a partial refund of its workers compensation payments from the judgment in favour of the plaintiff against the first defendant.
Mr Harris submits that there was an error in the terms of paragraph 3 of the Consent Judgment. Given the nature of the settlement, there should have been a judgment in favour of the second defendant in respect of the plaintiff’s claim against it, because the entry of a judgment in favour of a plaintiff against a defendant in a claim such as this, without specifying a monetary sum, is meaningless.
Mr Harris submits that the suggestion by the applicant that the calculation of the costs payable to it in accordance with Sch 7 should be made by reference to the damages paid by the first defendant under the Civil Liability Act 2002 cannot be correct because that sum did not have the character of work injury damages.
Mr Harris submits that if a judgment had been entered in favour of the second defendant following a contested hearing, the costs payable by the respondent would have been the same. Stage 8 would have applied to fix those costs at $20,600 plus GST. The respondent has made such an offer and will pay that sum on receipt of a tax invoice.
Mr Harris submits that the application for assessment of costs should be dismissed and an order should be made for the applicant to pay the respondent’s costs (with such sum to be fixed as a lump sum by the Commission).

LEGISLATION

The 1987 Act

Part 5 of the 1987 Act contains provisions regarding common law remedies. The relevant provisions are as follows:
“149   Definitions
(1) In this Part—
damages includes—
(a)  any form of monetary compensation, and
(b)  without limiting paragraph (a), any amount paid under a compromise or
     settlement of a claim for damages (whether or not legal proceedings
     have been instituted),
but does not include—
(c)  compensation under this Act…
151G   Only damages for past and future loss of earnings may be awarded
(1) The only damages that may be awarded are—
(a)  damages for past economic loss due to loss of earnings, and
(b)  damages for future economic loss due to the deprivation or impairment
                 of earning capacity.”

The 1998 Act

Part 1 of Ch 7 of the 1998 Act provides some assistance regarding interpretation of the new claims procedures. The relevant provisions are as follows:
“250 Interpretation
(1) In this Chapter—
damages has the same meaning as in Part 5 (Common law remedies) of the
1987 Act…

work injury damages means damages recoverable from a worker’s employer in respect of—
(a)  an injury to the worker caused by the negligence or other tort of the
           employer, or
(b)  the death of the worker resulting from or caused by an injury caused by
                 the negligence or other tort of the employer,

whether the damages are recoverable in an action for tort or breach of contract
or in any other action but does not include motor accident damages….”

The power to assess costs is contained in Div 3 and Div 3A of Pt 8 of Ch 7 of the 1998 Act. The relevant provisions are as follows:
“335   Assessment of costs
An assessment of costs is to be made so as to give effect to the provisions of this Part (whether or not the assessment is made under the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014)).
Division 2 Fixing of maximum costs and fees
337   Maximum lawyer and agent costs
(1)     The regulations may make provision for or with respect to the following—
(a)  fixing maximum costs for legal services or agent services provided to a claimant, an employer or an insurer in or in connection with any workers compensation matter or work injury damages matter…
(2)     Regulations under this section can fix costs and amounts by reference to costs and amounts fixed by regulations under the Legal Profession Uniform Law Application Act 2014.
(3)     A legal practitioner is not entitled to be paid or recover for a legal service or other matter an amount that exceeds any maximum costs fixed for the service or matter by the regulations under this section…

Division 3A Special provisions for costs in work injury damages proceedings

346   Costs
(1)     This section applies to costs (including disbursements) payable by a party in or in relation to a claim for work injury damages, including court proceedings for work injury damages.
(2)     The regulations may make provision for or with respect to the awarding of costs to which this section applies. The regulations may provide for the awarding of costs on a party and party basis, on a practitioner and client basis, or on any other basis.
(3)     A party is not entitled to an award of costs to which this section applies, and a court may not award such costs, except as prescribed by the regulations under this Act or by the rules of the court concerned.
(4)     In the event of any inconsistency between the provisions of the regulations under this section and rules of court, the provisions of the regulations prevail to the extent of the inconsistency.
Division 4 Costs assessment
347   Regulations for costs assessment
(1)   The regulations may make provision for or with respect to—
(a)the assessment or taxation of costs payable to a legal practitioner or agent in connection with a claim for compensation or work injury damages, and
(b)matters associated with the assessment or taxation of those costs…

(4)     Without limiting this section (but subject to the Personal Injury Commission Act 2020 and the Commission rules), the regulations may make provision for or with respect to—
(a)  the assessment of costs by the Commission, and
(b)  appeals to the Commission against the assessments of costs by the Commission.

Note—
Clause 5 of Schedule 3 to the Personal Injury Commission Act 2020 provides for the Commission to be constituted by 1 non-presidential member assigned to the Workers Compensation Division of the Commission when dealing with costs assessments under the regulations…”

The 2016 Regulation

Part 17 of the 2016 Regulation deals with costs. The relevant provisions are as follows:
“Division 3 Costs recoverable in work injury damages matters
Subdivision 1 Maximum costs recoverable by law practices in work injury damages matters
91   Application of Division
This Division is made under section 337 of the 1998 Act and applies to the following costs payable on a party and party basis, on a law practice and client basis or on any other basis—
(a)  costs for legal services or agent services provided in or in relation to a
     claim for work injury damages,
(b)  costs for matters that are not legal or agent services but are related to a
                 claim for work injury damages.
Note—
Section 337(3) of the 1998 Act provides that a law practice is not entitled to be paid or recover for a legal service or other matter an amount that exceeds any maximum costs fixed for the service or matter by regulations under section 337.
92   Fixing of maximum costs recoverable by law practices
(1) The maximum costs for—
(a)  legal services provided in or in relation to a claim for work injury
     damages, and
(b)  matters that are not legal services but are related to a claim for work
                 injury damages,
are the costs set out in Schedule 7, except as otherwise provided by this Part…
110   Assessment to give effect to maximum costs, 1998 Act and orders and
        rules of the Commission or court
An assessment of costs is to be made in accordance with, and so as to give effect to, orders of the Commission or a court, the Commission rules or rules of court, Part 8 of Chapter 7 of the 1998 Act, this Part, and Schedules 6 and 7.”

The note in cl 111 Pt 17 of the 1998 Act provides:
“Note—
Clause 110 requires an assessment of costs to give effect to the maximum costs set out in Schedules 6 and 7, as well as to other matters.
Section 337(3) and (4) of the 1998 Act provide that a law practice or an agent is not entitled to be paid or recover for a legal service or agent service or other matter an amount that exceeds any maximum costs fixed for the service or matter by regulations under section 337.”
Clause 116 of the 2016 Regulation sets out the provisions regarding the assessment of costs as follows:
“116 Assessment of costs—costs ordered by court or Commission or subject of agreement
(1)     When dealing with an application relating to costs payable as a result of an order made by a court or the Commission or as a result of an agreement referred to in clause 104(1)(b), the Commission must consider—
(a)whether or not it was reasonable to carry out the work to which the costs relate, and
(b)what is a fair and reasonable amount of costs for the work concerned.
(2)     The Commission is to determine the costs payable as a result of the order or agreement by assessing the amount of the costs that, in the Commission’s opinion, is a fair and reasonable amount.
(3)     If a court or the Commission has ordered that costs are to be assessed on an indemnity basis, the Commission must assess the costs on that basis, having regard to any relevant rules of the court or Commission.
(4)     The costs assessed are to include the costs of the assessment (including the costs of the parties to the assessment, and the Commission). The Commission may determine by whom and to what extent the costs of the assessment are to be paid.
(5)     The costs of the Commission are to be paid to the Commission.
Note—
Subdivision 2 of Division 3 of this Part limits the circumstances in which costs may be awarded on a party/party basis in relation to a claim for work injury damages.
Clause 110 requires an assessment of costs to give effect to the maximum costs set out in Schedules 6 and 7, as well as to other matters.”
The balance of the provisions in Pt 17 of the 1998 Act concern matters to be considered with respect to an application such as whether or not it was reasonable to carry out the work to which the costs relate, whether or not the work was carried out in a reasonable manner, and the fairness and reasonableness of the amount of the costs in relation to that work.
Schedule 7 of the 2016 Regulation sets out the maximum cost for legal services provided for the stage at which claim for work injury damages is finalised.
Column 1 of Work Injury Costs Table A describes the stage of finalisation and Column 2 sets out the quantum of costs. Table A applies to the present matter.

REASONS

The issue that I need to determine is the costs payable to the applicant based on the stage at which the WID claim was finalised.
The applicant claims Stage 6 costs based on the sum of $975,000, which was the final judgment in the plaintiff’s favour. This stage applies “If the matter is referred to mediation and is finalised after the commencement of court proceedings (whether by way of settlement or an award of damages)—from service of the pre-filing statement to finalisation of the matter”.
This involves the calculation of the quantum as follows:
Stages 3 (h) and 4(a)  $28,100
Stages 4(b) and 6(a)   $19,500
Stage 6(b)  $19,500
Table other Stage 3   $400
GST     $6,750
Total   $74,250
The respondent submits that the applicant is entitled to costs in the sum of $20,600 calculated in accordance with Stage 8 which applies “If the matter is finalised after the commencement of court proceedings other than by settlement or an award of damages—from service of the pre-filing statement to finalisation of the matter”.
Mr Robison submits that the parties entered into an agreement and this was formalised by the Consent Judgement, namely that the plaintiff was to be paid $975,000 by the first defendant less the sum of $100,000 payable to the second defendant. There was both a “settlement and an “award of damages” and it is not possible to determine which portion related to wok injury damages and which did not.
Mr Robison submits that the Judgment was with the consent of the parties and set out the terms of the settlement between the parties. The judgment for the plaintiff against the second defendant was not meaningless and there was no error. The gross award of damages demonstrated a statutory credit to GIO. It was inclusive of workers compensation payments, and GIO contributed by reducing its payback. This which meant that the legal fees should be calculated on the total value of the settlement before credit for payments made and that Stage 6 of Sch 7 of the 2016 Regulation applied.
Mr Robison submits that the plaintiff succeeded in his claim against the second defendant, so Stage 8 does not apply because there was no capitulation by the plaintiff. Stage 8 excludes a settlement or an award of damages. Although it made no monetary contribution, GIO agreed to forgo part of its recovery so it did in effect contribute to the settlement which was done in contemplation that it had some exposure. The plaintiff was paid damages as reflected in the reduction of the credit. It also referred to payment by the defendants, consistent with an award of damages referred to in the 2016 Regulation.
In contrast, Mr Harris submits that GIO made no payment of damages, settlement or an award as defined in ss 149(1) and 151G(1) of the 1987 Act and s 250(1) of the 1998 Act. There was no damages, settlement or award because the first defendant paid the totality of the settlement and the second defendant received a partial refund of its workers compensation payments, meaning that Stage 8 applied. The early stages show that they only apply where the employer has made a payment of work injury damages. He also submits that there should have a judgment in favour of the second defendant in respect of the plaintiff’s claim against it, because there was no amount payable by the second defendant. He maintains that Stage 8 applies.
The applicant’s entitlement will depend on the nature of the resolution of the dispute in the Supreme Court and the interpretation of the legislation.
The mediation proceedings in the Commission concerned a WID claim. I have reviewed the mediation file and note that in the Pre Filing Defence, the second defendant denied that it was liable and alleged that if the claimant’s injuries were caused by negligence, the negligent act was wholly that of Baiada. Ready Workforce made no offer to resolve the claim at the mediation, consistent with its defence. Of course, GIO had made payments of weekly compensation, medical expenses and lump sum compensation in accordance with its statutory obligations under the 1987 Act.
Unfortunately I have not been provided with a copy of the pleadings and evidence filed in the Supreme Court proceedings, but presumably this was similar to the material filed in the Commission. Given the circumstances of the plaintiff’s injury, there was obviously a different cause of action against the first defendant under the Civil Liability Act 2002, and it would have also filed additional evidence.
The Application for Mediation only comprised 278 pages and the Response had 279 pages. There was a liability report together with medical evidence in the Application that dated back to 2016. Much of the evidence was duplicated in the Response which included functional and vocational reports. There was no liability report, but this may have been obtained on behalf of Ready Workforce after the mediation concluded. One could not say that the evidence was extensive, but this may have been supplemented before the settlement.
In order to determine the applicant’s entitlement to costs, I need to analyse and interpret the provisions in the 1987 Act, 1998 Act and the 2016 Regulation.
The principles of statutory interpretation are well established and have been confirmed by the High Court in Project Blue Sky v Australian Broadcasting Authority[3] and Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT),[4] and in the Commission in Hesami v Hong Australia Corporation Pty Ltd[5] and Abu-Ali.
[3] [1998] HCA 28; 194 CLR 355.
[4] [2009] HCA 41; 239 CLR 27 (Alcan).
[5] [2011] NSWWCCPD 14.
One must interpret the ordinary and grammatical meaning of the text, the language and structure of the legislation, the legal and historical context, and the purpose of the statute in order to come to a reasonable conclusion as to its meaning and application.
Stage 6 of the Table A of the 2016 Regulation stipulates that the matter (i.e. a WID claim) has to be referred to mediation and is then finalised after the commencement of court proceedings, whether by way of settlement or an award of damages.
Stage 8 of the Table A of 2016 Regulation stipulates that the matter (i.e. a WID claim) is finalised after the commencement of court proceedings other than by settlement or an award of damages.
There is no reference to a “judgment” or a definition of the term “settlement” in the Acts or the 2016 Regulation in respect of a WID claim.
GIO paid the plaintiff weekly compensation, medical expenses and lump sum compensation. According to the definition of “damages” in s 149(1) of the 1987 Act, “damages” does not include “compensation under this Act”. Therefore, the workers compensation payments made to the plaintiff do not constitute “damages” under the 1987 Act.
Section 250(1) of the 1998 Act specifically refers to the definition in the 1987 Act, but also mentions work injury damages, which is defined as damages recoverable from a worker’s employer in respect of an injury to the worker caused by the negligence or other tort of the employer, whether the damages are recoverable in an action for tort or breach of contract
or in any other action. So the injury must be caused by negligence or other tort of the employer so as to give rise to an entitlement to work injury damages.
The Consent Judgment was drafted by the solicitor for the first defendant. The judgment or award of damages was only against the first defendant. The damages were $975,000 inclusive of any statutory paybacks, costs and disbursements and workers compensation payments. Under the terms of the judgment, the first defendant was required to pay $875,000 to the plaintiff and $100,000 to GIO.
Although there was judgment for the plaintiff against the second defendant, there was no monetary award of damages. There was only a notation that GIO would not seek to recover from the plaintiff or from the first defendant the balance of the workers compensation payments that were made. This meant that the claim was finalised against the second defendant.
There was no monetary settlement or award of damages between the plaintiff and the second defendant to satisfy the criteria in Stage 6 of Table A of Sch 7 of the 2016 Regulation.
The claim against the second defendant was finalised after the commencement of court proceedings other than by settlement or an award of damages against the second defendant, so the applicant’s entitlement to costs should be calculated in accordance with Stage 8 of Table A of Sch 7 of the 2016 Regulation in the sum of $20,600 plus GST. The applicant would also be entitled to the costs of the mediation in accordance with Stage 3 of the Other Work Injury Costs Table in the sum of $400 plus GST, giving an entitlement of $21,000 plus GST.
Even if I was wrong and the applicant’s costs were to be assessed under Stage 6, it is not appropriate for the applicant to claim Stage 6 costs based on the quantum of the judgment against the first defendant as this related to a completely different cause of action.
The first defendant paid the plaintiff $875,000 in respect of the cause of action under the Civil Liability Act 2002, and reimbursed GIO the sum of $100,000.It is true that there were cross claims, but these were dismissed with each party to bear its own costs.
The costs payable to the applicant must relate to the WID claim, not to the gross value of the judgment of $975,000 against the first defendant. GIO received a payback of $100,000 from plaintiff via the first defendant. Its exposure would have only amounted to the workers compensation that was not reimbursed.
The appropriate settlement sum to be considered for the calculation of costs under Stage 6 would at best be the amount of $126,752.74, being the unpaid balance of workers compensation payback. The costs entitlement under Stage 6 of Sch 7 would amount to $18,205.16 plus $400 for the mediation, plus GST, so an assessment in accordance with Stage 8 is more beneficial for the applicant.
Of course, Sch 7 sets the maximum costs payable for the relevant stage at which the claim is finalised. Normally I would need to determine if the maximum costs claimed by the applicant
were fair and reasonable, having regard to the principles discussed in Berger v Moree Plains Shire Council[6] and Nimbin Hotel Pty Limited v Dalton.[7]
[6] [2005] NSW WCC PD 152 (Berger).
[7] [2007] NSWWCCPD 17.
However there is no way of me knowing relevant matters such as the degree of skill, labour and responsibility provided by the applicant’s solicitor and those who worked on the file, the complexity of the matter with regards to Baiada’s liability, the quality of the work, and other important matters in the absence of the applicant’s file and a detailed memorandum of costs.
In order to consider this question, I would need to review applicant’s file and this will only delay the finalisation of this assessment, which would be inconsistent with the Commission’s statutory obligations.
Given that the respondent has offered to pay $20,600 which is consistent with my assessment, I do not see the need to review these aspects any further and will allow the maximum under Stage 8 of Sch 7.

Costs of the assessment

Clause 116(4) of the 2016 Regulation provides the Commission with the discretion to determine whom and to what extent the costs of the assessment are to be paid. This can relate to the costs of the parties and the Commission.
The applicant did not seek the costs of the assessment. Mr Harris submits that the application for assessment of costs should be dismissed and an order should be made for the applicant to pay the respondent’s costs.
The applicant had the right to seek an assessment of its costs. The issue had a degree of complexity. The application for costs should not be dismissed, rather an order should be made in the applicant’s favour. The assessed costs were in accordance with the respondent’s position, apart from the additional $400 for the mediation.
This is a novel situation involving an insurer who retained the applicant to appear on its behalf, only to reject the claim for costs because of the provisions in the 2016 Regulation and its former solicitors. It is unfortunate that the issue could not be amicably resolved, but I can understand the positions of both parties.
However, I am of the view that the respondent should be entitled to the costs of the assessment as its position was largely confirmed on assessment.
In the exercise of my discretion, I consider that the applicant should pay the respondent’s costs of the assessment in the sum of $1,200 plus GST. This is based on a figure of $400 per hour for three hours work by Mr Harris. I do not propose to make any order with respect to the Commission’s costs of the assessment.

ORDERS

The respondent is to pay to the applicant’s costs in the sum of $21,000 plus GST within 28 days of this assessment.
The applicant is to pay the respondent’s costs of this assessment in the sum of $1,200 plus GST within 28 days of this assessment.

[2023] NSWPIC 582

3 November 2023