Jacobs v OneSteel Manufacturing Pty Ltd - [2006] SASC 32

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Case Stated)
JACOBS v ONESTEEL MANUFACTURING PTY LTD & WORKCOVER CORPORATION OF SA
Judgment of The Full Court
(The Honourable Justice Duggan, The Honourable Justice Debelle, The Honourable Justice Besanko, The Honourable Justice Vanstone and The Honourable Justice Layton)
3 February 2006
ADMINISTRATIVE LAW - ADMINISTRATIVE TRIBUNALS - GENERALLY
Case stated by Full Bench of Workers Compensation Tribunal pursuant to Workers Rehabilitation and Compensation Act 1986, s 86A – whether Tribunal has jurisdiction to determine validity of rules of Tribunal as collateral issue – if so, whether rules of Tribunal prescribing scale of costs valid – if so, whether such rules inconsistent with regulations and thereby invalid.
Held – Tribunal has jurisdiction to determine validity of rules of Tribunal as collateral issue where challenge to validity based on ground of simple ultra vires or inconsistency with regulations – rules of Tribunal prescribing scale of costs valid exercise of rule-making power in s 88E of Act – no direct inconsistency between rules and regulations – regulations do not evince intention to cover field – rules valid.
Workers Rehabilitation and Compensation Act 1986 ss 3, 49, 78, 78B, 79, 85, 86, 86A, 87A, 88E, 88F, 88G, 88I, 89A, 91, 91A, 92D, 93B, 94, 94A, 94C, 95, 123A, 124; Workers Compensation Tribunal Rules 1996 r 15; Workers Compensation Tribunal Rules 2001 r 28; Workers Compensation Tribunal Rules 2005 (generally); Workers Rehabilitation & Compensation (Dispute Resolution) Regulations 1996 (generally); Supreme Court Rules 1987 r 98; Supreme Court Act 1935 s 31; Road Maintenance (Contribution) Act 1963-1968 (generally); Motor Vehicles Act 1959-1962 (generally); Subordinate Legislation Act 1978 s 4; Listening Devices Act 1969 (Vic), referred to.
Hinton Demolitions Pty Ltd v Lower (No 2) (1971) 1 SASR 512; Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245; Mitsubishi Motors Australia Ltd v Kowalski (2004) 236 LSJS 101; Qantas Airways Ltd v Gubbins (1992) 28 NSWLR 26; Wandsworth London Borough Council v Winder [1985] AC 461; Kruse v Johnson [1898] 2 QB 91; Widgee Shire Council v Bonney (1907) 4 CLR 977; Bishop v Deverix [1908] SALR 122; Foley v Padley (1984) 154 CLR 349; Boddington v British Transport Police [1999] 2 AC 143; O'Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565; Grannall v Marrickville Margarine Pty Ltd (1955) 93 CLR 55; Cole v Whitfield (1988) 165 CLR 360; Customs & Excise Commissioners v Cure & Deeley Ltd [1962] 1 QB 340; Utah Construction & Engineering Pty Ltd v Pataky [1966] AC 629; Ministry of Housing & Local Government v Sharp [1970] 2 QB 223; Daymond v Plymouth City Council [1976] AC 609; Chief Adjudication Officer v Foster [1993] AC 754; Commonwealth v Colonial Combing Spinning and Weaving Co Ltd (1922) 31 CLR 421; Gunner v Helding (1902) 28 VLR 303; Cox & Hazell Pty Ltd v Muswellbrook Municipal Council (1981) 48 LGRA 212; Attorney-General (Qld) v Australian Industrial Relations Commission (2002) 213 CLR 485; Matthews v Ministry for Defence [2003] 1 AC 1163; Edwards v Giudice (1999) 94 FCR 561; Selby v Pennings (1998) 19 WAR 520; Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597; Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223; South Australia v Tanner (1989) 166 CLR 161; R v Toohey; Ex parte Northern Land Council (1981) 151 CLR 170; Ousley v The Queen (1997) 192 CLR 69; Hinton Demolitions Pty Ltd v Lower [1968] SASR 370; Epstein v WorkCover Corporation of South Australia (2003) 85 SASR 561; Mayor of Hobart v Maxwell (1900) 2 N & S 8; Spreadborough v Walcott; Ex parte Walcott [1904] St R Qd 104; Langley v Edwards (1908) 10 WALR 108; Bugg v Director of Public Prosecutions [1993] QB 473; O'Reilly v Mackman [1983] 2 AC 237; R v Wicks [1998] AC 92; Federal Airports Corporation v Aerolineas Argentinas (1997) 76 FCR 582; Taylor v Guttilla (1992) 59 SASR 361, considered.

WORDS AND PHRASES CONSIDERED/DEFINED
"collateral challenge"

JACOBS v ONESTEEL MANUFACTURING PTY LTD & WORKCOVER CORPORATION OF SA
[2006] SASC 32
Full Court: Duggan, Debelle, Besanko, Vanstone and Layton JJ

DUGGAN J. I agree that the questions of law in the case stated should be answered in the manner proposed by Besanko J. I also agree with the reasons of Besanko J.
DEBELLE J. Put shortly, the questions in this case stated are whether the Workers Compensation Tribunal has jurisdiction to determine the validity of the Rules of the Tribunal as a collateral issue when determining other issues and, if so, whether certain Rules of the Tribunal are valid. The facts leading to the case stated are recited by Besanko J and need not be repeated.
The protagonists on the appeal are the worker, Mr Jacobs, and WorkCover Corporation which intervened pursuant to s 123A of the Workers Rehabilitation and Compensation Act 1986. The employer, OneSteel Manufacturing Pty Ltd, did not wish to be heard. A Court of five judges was convened because it appeared that the issues in this appeal might require reconsideration of the decision of the Full Court in Hinton Demolitions Pty Ltd v Lower (No 2) (1971) 1 SASR 512. In the result, it was not necessary to reconsider that decision.
A Jurisdiction to Determine Validity?
The first question is whether the Workers Compensation Tribunal (“the Tribunal”) has jurisdiction to determine the validity of Rules of the Tribunal as collateral issues in the determination of an entitlement of a worker to costs against his employer. Implicit in this question are two further questions. The first is whether the Tribunal has jurisdiction to determine questions of law. If it has, the second question is whether it has jurisdiction to determine the question of invalidity as a collateral issue.
Before examining these questions, it is necessary to note the rule‑making power of the Tribunal, the composition of the Tribunal, and the jurisdiction exercised by the Tribunal.
The rules of the Tribunal are called the Workers Compensation Tribunal Rules (“the Rules”). The Rules are made by the President of the Tribunal in consultation with a Rules Committee: s 88E of the Workers Rehabilitation and Compensation Act 1986 (“the Act”).
The Tribunal comprises judges and conciliation and arbitration officers. The Tribunal may be constituted by either a Full Bench (which comprises three presidential members), a single presidential member, or a single conciliation and arbitration officer: s 78. The Registrar has a limited jurisdiction under s 78B of the Act but that jurisdiction is irrelevant for present purposes.
The presidential members of the Tribunal are the Senior Judge of the Industrial Relations Court of South Australia, who is the President of the Tribunal, and Deputy Presidents of the Tribunal who are judges other than the Senior Judge of the Industrial Relations Court. Thus, all of the presidential members of the Tribunal are judges. There is no requirement that the conciliation and arbitration officers be lawyers.
The Tribunal has the jurisdiction conferred by statute: s 79 of the Act. The nature of that jurisdiction is spelled out in Part 6A of the Act which prescribes a régime for the resolution of disputes between a worker and the compensating authority. The first step in the resolution of such disputes is that the relevant compensating authority must reconsider its decision: s 91. If it confirms its decision or if it varies its decision but the worker is dissatisfied with the result, the Registrar must refer the dispute for conciliation: s 91A. If the conciliation proceedings do not resolve the dispute, the conciliator must refer the dispute for arbitration or for judicial determination: s 92D. If a party is dissatisfied with the arbitration, the Tribunal must make a judicial determination of the disputed claim: s 94(b).
Conciliations are conducted by a presidential member or a conciliation officer. Arbitrations are conducted by the Tribunal’s conciliation and arbitration officers: see s 93 and the definition of an arbitration officer in s 3 of the Act. The nature of the processes of conciliation and arbitration as provided in the Act is unlikely to require determination of questions of law.
A judicial determination of a disputed claim is made by a single presidential member of the Tribunal, unless the President decides that the dispute should be referred to the Full Bench of the Tribunal: s 94A of the Act. Thus, a judicial determination is made by either a judge or judges of the Tribunal. The Parliament has conferred upon the presidential members of the Tribunal the jurisdiction to determine disputes between a worker and the relevant compensating authority. When the Tribunal makes a judicial determination, it will often have to determine questions of law. Its jurisdiction requires it to make binding and authoritative decisions concerning controversies between workers and the relevant compensation authority. When it makes those decisions, it determines existing rights and duties and does so according to law, in particular, the Workers Rehabilitation and Compensation Act, the terms of which are capable of giving rise to a wide variety of questions.It does not have power to enforce its decisions but its decisions are enforceable as a judgment or order of the District Court once a certified copy of the judgment order of the Tribunal is filed in the District Court: s 87A of the Act. The Tribunal has all the hallmarks of a judicial tribunal: Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245 at 267 – 268 where the characteristics of a tribunal exercising judicial power are listed. In Mitsubishi Motors Australia Ltd v Kowalski (2004) 236 LSJS 101 the Full Court held that the Tribunal exercises judicial power. I respectfully agree. The Tribunal is not an administrative tribunal but a judicial tribunal with the statutory duty to resolve disputes according to law. That duty is in no respect qualified by the fact that s 85 of the Act requires the Tribunal to act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms: Qantas Airways Ltd v Gubbins (1992) 28 NSWLR 26 at 31 per Gleeson CJ and Handley JA.
Shortly stated, the Tribunal must act according to law and in particular must act according to the provisions of the Workers Rehabilitation and Compensation Act. Not infrequently, the making of a judicial determination involves the determination of questions of law. Judicial members, therefore, have jurisdiction to decide questions of law. That conclusion is re‑inforced by s 86 of the Act which provides that an appeal lies on a question of law from a decision of the Tribunal constituted by a single presidential member to the Full Bench of the Tribunal. It is implicit in s 86 that a presidential member has already decided a question of law.
The question whether the Rules of the Tribunal are valid is a question of law. As the Tribunal has jurisdiction to determine questions of law, it has jurisdiction to determine the validity of its Rules. There was no dispute that the Tribunal had jurisdiction to determine questions of law. The real question was whether it had jurisdiction to determine validity of the Rules of the Tribunal as a collateral issue.
Determining Collateral Issues
The question whether the Tribunal has power to determine the validity of its Rules as a collateral issue is asked in broad terms. It does not specify the nature of the collateral challenge. However, each of the questions which follow is limited to a challenge to validity of named Rules on the ground that the exercise of power to make the Rules is ultra vires the Act being contrary to nominated provisions in the Act. The question as to the circumstances in which a collateral challenge may be made is not yet finally resolved. As Professor Wade notes in Wade and Forsyth, Administrative Law (9^th ed) at 281, one of the difficulties with the expression “collateral challenge” or “collateral issue” is that an issue is not truly collateral if it is the central issue to be decided. The remarks of Robert Goff LJ in Wandsworth London Borough Council v Winder [1985] AC 461 at 475 illustrate the issue. In other instances the question is compounded by the fact that the decision will affect third parties not before the court. As the challenge to the validity of the Rules is based only on the ground of ultra vires, it is necessary for this Court only to consider that issue. The question whether a collateral challenge may be made on other grounds does not arise.
It has long been settled law that a collateral challenge may be made to the validity of delegated legislation on the ground that it ultra vires. A collateral challenge may be made to the validity of delegated legislation as a defence in a criminal prosecution: see, for example, Kruse v Johnson [1898] 2 QB 91; Widgee Shire Council v Bonney (1907) 4 CLR 977; Bishop v Deverix [1908] SALR 122. The High Court has on several occasions not questioned that by‑laws may be challenged as a collateral issue in a prosecution under that by‑law: Widgee Shire Council v Bonney; Foley v Padley (1984) 154 CLR 349, although in Widgee Shire Council v Bonney at 986 Isaacs J expressly approved a collateral challenge. A collateral challenge in criminal proceedings was expressly approved by the House of Lords in Boddington v British Transport Police [1999] 2 AC 143.
Challenges to the validity of Commonwealth legislation are another form of judicial review of the power to make legislation. Although clearly not delegated legislation as ordinarily understood, the fact that Commonwealth legislation must be within the scope of powers vested in the Commonwealth Parliament under the Constitution is a convenient analogy. A number of decisions as to the validity of Commonwealth legislation have been determined as a collateral challenge in criminal prosecutions: see, for example, O’Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565; Grannall v Marrickville Margarine Pty Ltd (1955) 93 CLR 55; Cole v Whitfield (1988) 165 CLR 360.
Similarly, issues as to the validity of delegated legislation which arise in the course of civil proceedings may be determined as a collateral issue: see, for example, Customs & Excise Commissioners v Cure & Deeley Ltd [1962] 1 QB 340; Utah Construction & Engineering Pty Ltd v Pataky [1966] AC 629; Ministry of Housing & Local Government v Sharp [1970] 2 QB 223; Daymond v Plymouth City Council [1976] AC 609; Chief Adjudication Officer v Foster [1993] AC 754. This is but one example of the requirement in Rule 46.10 of the Supreme Court Rules to plead the provisions of a statute on which a party relies. In Boddington (at 175) Lord Steyn expressly stated that a collateral challenge to sub‑ordinate legislation is permitted in both civil and criminal cases. An example of a challenge to the validity of executive action in civil proceedings is Commonwealth v Colonial Combing Spinning and Weaving Co Ltd (1922) 31 CLR 421.
The obvious policy reason to allow a collateral challenge to the validity of delegated legislation in criminal or civil proceedings is that it avoids an unnecessary duplicity of proceedings: see Lord Bridge in Chief Adjudication Officer v Foster [1993] AC 754 at 766 – 767, affirmed by Lord Steyn in Boddington at 175. To adopt a contrary view would lead to fragmentation of procedures and an inappropriate distinction between public law and private law when, not infrequently, the validity of delegated legislation affects private law rights.
However, a collateral challenge may not be made where a statute expressly forbids it, although the fact that the empowering Act includes a means by which to test the validity of delegated legislation is not a bar to a collateral challenge: Gunner v Helding (1902) 28 VLR 303; Bishop v Deverix; Cox & Hazell Pty Ltd v Muswellbrook Municipal Council (1981) 48 LGRA 212 and other decisions noted in Pearce and Argument, Delegated Legislation in Australia (2^nded) at 26.14. For these reasons the Tribunal has jurisdiction to determine the validity of its Rules as a collateral issue in making a judicial determination.
I do not think that the Tribunal’s jurisdiction to determine the validity of its Rules is in any sense restricted by the distinction between a procedural defect and a substantial defect. That distinction is not always easy to draw: Boddington per Lord Steyn at 170 or clear-cut: Attorney‑General (Qld) v Australian Industrial Relations Commission (2002) 213 CLR 485 at [6] per Gleeson CJ. The distinction between substance and procedure was described as “slippery” by Lord Hoffmann in Matthews v Ministry for Defence [2003] 1 AC 1163 at [33]. In Boddington the House of Lords held that no distinction is to be drawn between a substantive error of law or a procedural error of law. As Lord Irvine said at 158:
No distinction is to be drawn between a patent (or substantive) error of law or a latent (or procedural) error of law. An ultra vires act or subordinate legislation is unlawful simpliciter and, if the presumption in favour of its legality is overcome by a litigant before a court of competent jurisdiction, is of no legal effect whatsoever.
That aspect of the decision in Boddington has been applied by courts in Australia: Edwards v Giudice (1999) 94 FCR 561 at 592; Selby v Pennings (1998) 19 WAR 520 at 535, 543.
The fact that the worker’s application to determine the validity of the Rules was made in the course of a judicial determination of a dispute with his employer as to costs is, therefore, no bar to the determination of the question of validity.
The decision in Hinton does not in any respect affect the validity of this conclusion. For the reasons which follow, it has no application to the issues currently before the Court. That decision concerned a challenge to a prosecution for breach of regulations as to load capacity of motor vehicles. One of the challenges made by way of collateral challenge was that there had been an alleged breach of the rules of natural justice when determining the load capacity of the vehicle in question. That challenge concerned the validity of an administrative, not a legislative, act. In this case the only question is the validity of a legislative act. The remarks in Hinton do not, therefore, have any application in the particular circumstances of this case. It must also be noticed that in that case the Full Court also determined a collateral challenge to the validity of the Regulations on the ground of ultra vires and no issue was raised as to the propriety of doing so.
In addition, I do not think that the distinction between void and voidable Acts is relevant to the issues in this case stated. That distinction was laid to rest in Boddington. In addition, a majority of the High Court has said that the distinction is not helpful: Minister for Immigration and Multicultural Affairsv Bhardwaj (2002) 209 CLR 597 per Gaudron and Gummow JJ at 612 ‑ 613, McHugh J at 618 and Hayne J at 643 – 647. The question whether the Court will invalidate delegated legislation will not depend on that distinction but on discretionary considerations: see the discussion in Wade and Forsyth, Administrative Law at 301.
For these reasons, the Tribunal has jurisdiction to determine the validity of its Rules as collateral issues in the determination of an entitlement of a worker to costs against his employer. Question 1 should be answered, yes.
Questions 2 and 4

Questions 2 and 4 may be conveniently considered together. They ask respectively if Rule Fifteen (7) (e) and (f) and Rule Twenty‑Eight (7) (d) and (e) of the Rules are each a valid exercise of the power contained in s 88E of the Act.
Provisions relating to awards of costs in the Tribunal are to be found in the Act, in regulations made under the Act, and in the Rules of the Tribunal.
Section 88E(f) invests the President of the Tribunal with power to make rules of the Tribunal regulating costs. Rules of court have been made by the President in 1996 and in 2001. The Rules made in 2001 have been replaced by Rules made in 2005 but the 2005 Rules are not relevant to this matter. Rule Fifteen is the rule relating to costs in the 1996 Rules and Rule Twenty Eight is the rule relating to costs in the 2001 Rules. Sub‑rule (7) of Rules Fifteen and Twenty-Eight both deal with costs incurred in the course of a judicial determination. Paragraphs (d), (e) and (f) of Rule Fifteen (7) are in these terms:
(d)A party entitled to an award of costs in respect of a trial at judicial determination may be awarded up to 85% of the Supreme Court scale for all reasonably necessary preparatory work. Consistent with the expectation that the parties shall have: obtained an advice on evidence; properly proofed all witnesses so as to be able to make an informed decision as to which witnesses are required to give oral testimony (if the witness is not otherwise required for cross‑examination); carefully reflected upon the witness statements and expert reports of the other parties so as to be able to make an informed decision as to which witnesses are required for cross‑examination; identified all potential issues and factual matters capable of agreement and have taken steps to secure agreement in respect thereof; shall be in a position to make submissions as to costs upon receipt of judgment; and generally have taken all reasonable measures to ensure that the trial proceeds expeditiously and only occupies sitting time in court to the extent that it is absolutely necessary*; the following scale of counsel fees (other than in respect of a referral pursuant to section 94A(2)) shall apply.
· Fee on brief – including conferences, reading time, preparation and up to the first 5 hours in court an amount not exceeding $1750.00.
· Refresher fees – if the trial extends beyond 5 sitting hours counsel fees will be based upon time spent in court and unless provision is specifically made, no further allowances shall be made for conferences; reading time or preparation. Such refresher fees shall be awarded as follows:
·For time spent beyond 5 hours and up to 10 hours – at the rate of up to $150.00 per hour.
·For time spent beyond 10 hours and up to 20 hours – at the rate of up to $100.00 per hour;
·For time spent beyond 20 hours – at the rate of up to $60.00 per hour.
·Where written submissions are provided costs shall be awarded on an hourly rate commensurate with 1.5 times that which would apply had the submissions been made orally.
·Where judgment is delivered in Court an amount of $100.00 to receive judgment.
*For example: converting video evidence into a short passage of edited highlights for showing in court (subject of course to all video tapes being made available to the other parties to the dispute after cross‑examination of the relevant witness has been completed); obtaining and providing to the other parties copies of notes that a witness may seek to rely upon in giving evidence; scheduling witnesses so as to ensure that sufficient time is allowed for the receipt of their evidence; agreeing where possible to interpose witnesses and if interposition is not possible to indicate that to the other parties at the earliest possible time; arranging witnesses so as to ensure that the available time is best utilised.
(e)Notwithstanding the limitations on counsel fees previously expressed if the presiding Member is of the opinion that the party against whom a costs order is to be made has unnecessarily prolonged the hearing the presiding Member may award an amount of up to $150.00 per hour for counsel fees for any period of time spent in court after the first 5 hours.
(f)Transitional provision
Rule Fifteen (7)(d) and (e) shall apply to all trials commencing on or after 1 June 2000 and may, in the absolute discretion of the presiding Member, apply to trials commencing before that date. Parties who already have disputes set down for hearing may wish to consider whether further steps can be undertaken to truncate the hearing of their matter and to reconsider the time previously specified as being required to conduct the hearing.
It will have been noticed that the fees for refreshers fixed by para (d) reduce as the length of the hearing increases. That is the catalyst for the asserted invalidity of para (d). There is no direct challenge to para (e) which authorises the presidential member of the Tribunal to allow a higher rate for refresher notwithstanding the terms of para (d). Paragraph (e) stands or falls with para (d). Paragraph (f) is merely a transitional provision which, like para (3) also stands or falls with para (d).
Rule Twenty Eight (7) is in almost identical terms to Rule Fifteen (7). Paragraph (d) of Rule Twenty Eight (7) is in the same terms save that the rates per hour have been increased in the 2001 Rules. It reduces fees for refreshers according to the length of the hearing in a like manner to Rule (7) (d). Paragraph (e) authorises the presidential member to allow a higher rate notwithstanding the terms of para (d). As there is no material difference between the Rules, it is unnecessary to recite the terms of Rule Twenty Eight (7).
The submission that Rules Fifteen (7) and Twenty Eight (7) are invalid is grounded on s 95(1) of the Act. It is convenient to set out the whole of the terms of s 95. It provides:
(1)A party (other than the relevant compensating authority) is entitled, subject to this Part and to limits prescribed by regulation, to an award against the relevant compensating authority for the party's reasonable costs of –
(a)     the initial reconsideration of a disputed decision; and
(b)     any subsequent proceedings for resolution of the dispute under this Part (but not proceedings by way of an appeal or case stated to a Full Bench of the Tribunal or the Supreme Court).
(2)Costs may only be awarded to cover -
(a)     the cost of representation by a legal practitioner or an officer or employee of an industrial association; and
(b)     costs of a kind authorised by the regulations that were reasonably incurred.
(3)If the Tribunal is of the opinion that a party acted unreasonably, frivolously or vexatiously in bringing or in relation to the conduct of proceedings, the Tribunal may -
(a)     decline to make an award of costs in favour of the party and may further (if it thinks fit) make an award of costs against the party; or
(b)     reduce the amount of the award to which the party would otherwise have been entitled.
(4)An award of costs to cover professional advice or assistance may, if the Tribunal considers appropriate, be made in favour of the person who provided the professional advice or assistance.
(5)An award of legal costs cannot exceed 85% of the amount that would be allowable under the relevant Supreme Court scale if the proceedings were in the Supreme Court.
The submission of invalidity relies on the opening words of s 95(1) which creates an entitlement to an award of reasonable costs “subject to this Part and to limits prescribed by regulation”. The reference to “this Part” is to Part 6A of the Act, the part prescribing the means of dispute resolution. No person, it is said, has authority to qualify the reasonable costs by Rules. The only limits are those provided in the Act and regulations.
It is submitted on behalf of the worker that s 95(1) provides a successful party with an entitlement to reasonable costs and that that entitlement is subject only to Part 6A of the Act or to limits prescribed by regulations. It is submitted that the absence of any reference to Rules of Court in s 95 means that Rules of Court cannot prescribe any limitation upon the entitlement to reasonable costs. It is contended that Rules Fifteen and Twenty Eight limit the entitlement to costs, thus rendering them invalid. The only valid restriction on the entitlement to reasonable costs is what is in Part 6A or regulations. The consequence is, it was said, that s 88E(1)(f) which provides the power to make Rules as to costs must be read down so as not to apply to the entitlement to reasonable costs.
Before examining the argument, it is necessary to notice the other provisions in Part 6A relating to costs and the regulations which have been made under the Act. There are two relevant statutory provisions in Part 6A. They are s 93B and s 94C(2)(c) which are in almost identical terms. Section 93B provides:
If the amount of lump sum compensation is disputed by a worker, and the amount to be awarded on an arbitration is less than, the same as, or less than 10% above the amount offered in conciliation proceedings, the worker is not entitled to costs of the arbitration proceedings.
Section 94C(2)(c) provides:
if the amount of lump sum compensation is disputed by a worker, and the amount the Tribunal proposes to award under this Division is less than, the same as, or less than 10% above the amount awarded on an arbitration or offered in conciliation proceedings, the worker is not entitled to costs of the proceedings under this Division
Both provisions provide a limit on costs but neither has any relevance to the issue of invalidity other than to provide an example of a statutory provision which not only limits an entitlement to costs but denies an entitlement in the circumstances provided in each provision.
Regulations have been made pursuant to the power to do so expressed in s 124 of the Act. They are called the Workers Rehabilitation & Compensation (Dispute Resolution) Regulations 1996 (“the Regulations”). Regulation 7 of the Regulations prescribes limits on costs in relation to proceedings under Part 6A and Part 6B of the Act. Regulation 7(2) provides:
Pursuant to section 95(1) of the Act the costs awarded to a party who is represented in proceedings before the Tribunal under Division 6 of Part 6A of the Act cannot exceed 85% of the costs that would be payable on a party and party basis if the proceedings were proceedings before the Supreme Court.
Both reg 7(2) and s 95(5) provide examples of limits upon the award of costs.
There are, therefore, limits in both Part 6A of the Act and in the Regulations to an award of reasonable costs. Those limits are in s 93B, s 94C(2)(c) and in s 95 of the Act and in reg 7. Section 95(5) and reg 7(2) are both limits on the recovery of costs. They each cap the liability for costs of the relevant compensating authority.
One effect of the argument on behalf of the worker is that the power of the President to make rules regulating costs is entirely nugatory. If correct, it has the result that there are no rules as to costs save those contained in the Act and in the Regulations. As is apparent from the provisions in the Act which have been quoted and from reg 7, that will result in no guide as to the payment of costs. These considerations are not an argument against invalidity. They merely illustrate the consequences of the argument.
The argument seeks to give to s 95(1) an operation which was not intended by the Parliament. It is clearly apparent from s 88E that the Parliament intended that the President of the Tribunal should have power to make rules, including rules regulating costs.
Section 95 is drawn on the footing that the Tribunal will exercise the power conferred by s 88E to make Rules regulating costs. That conclusion becomes clearer if s 95 is considered without the clause “subject to this Part and to limits prescribed by regulation”. It is then readily apparent that there is no means by which to determine how much might be recovered by way of costs except by resort to rules made pursuant to s 88E. It is also readily apparent that the provisions of Part 6A have been drawn on the footing that rules will be drawn which will provide in what circumstances costs will be recovered and the amount of those costs.
Furthermore, the entitlement provided by s 95(1) to recover costs is not at large but is an entitlement to recover reasonable costs. The epithet “reasonable” implies that there is a limit on what might be recovered by way of costs. The limit is provided in part at least by the Rules. Paragraph (d) in both Rule Fifteen (7) and Rule Twenty Eight (7) is an obvious example. A party is not entitled to recover what he has paid his counsel as a fee on brief or fees for refreshers. Instead, he is entitled only to recover the counsel fees allowed by para (d). Once costs have been assessed in accordance with the Rules, they become subject to the limits to which s 95(1) refers. Thus, to take an obvious example, if the fees as determined under the Rules exceeded 85% of the Supreme Court Scale, the excess would not be recoverable by reason of s 95(5) and reg 7(2).
The question of costs involves at least two aspects. One is the circumstances in which one party may be liable to pay costs to another. The other is the amount of those costs. For that reason, it is implicit in the power to make rules “regulating costs” to regulate both the circumstances in which costs may be payable and the amount of those costs. The Rules provide a régime which determines what costs are reasonable. Once the reasonable costs have been determined, any limits prescribed in s 95(1) may operate.
For these reasons, the worker’s submission misconceives the operation and effect of s 95(1). Both Rule Fifteen (7)(d), (e) and (f) and Rule Twenty Eight (7) (d) and (e) are valid Rules. The answer to both questions 2 and 4 is yes.
Questions 3 and 5
Questions 3 and 5 are asked on the premise that Rules Fifteen (7)(d), (e) and (f) and Rule Twenty Eight (d) and (e) are both valid. Questions 3 and 5 ask if those rules are consistent with reg 7(2) of the Regulations and are thereby valid. This aspect of the worker’s challenge to the validity of the Rules is based on the same grounds as are canvassed in questions 2 and 4. The argument fails for the reasons already expressed. The Rules would be inconsistent with reg 7(2) if they did not comply with reg 7(2) or if reg 7(2) was intended to cover the field in relation to an award of costs. There is no direct inconsistency in the sense that the Rules do not comply with s 7(2). The Rules provide for an award of costs. By dint of s 95(1) that award of costs is subject to the cap expressed in reg 7(2). Thus, the Rules provide the means to determine the amount of costs. Once the amount has been determined, regard must be had to s 95(1). The Rules and s 95(1) each have a different function. It is possible to comply with each. It is apparent that reg 7(2) does not purport to cover the field. It does no more than provide a cap upon the amount of costs which might be recovered.
Both rules are therefore consistent with reg 7(2) and are valid. The answer to both questions 3 and 5 is no.
Conclusion
For these reasons, the worker’s challenge to the validity of the Rules must fail. The questions in the case stated must be given the following answers.
1.     Yes
2.     Yes
3.     No
4.     Yes
5.     No
BESANKO J: The Full Bench of the Workers Compensation Tribunal has stated a case pursuant to s 86A of the Workers Rehabilitation and Compensation Act 1986 (“the Act”) raising five questions of law for the opinion of this Court.
Background to the case stated
The Full Bench of the Tribunal has set out the facts in the case stated and what follows is taken from the case stated.
Mr Robert Jacobs was employed by OneSteel Manufacturing Pty Ltd. That company was formerly known as BHP Integrated Steel. OneSteel Manufacturing was registered as an exempt employer under Division 1 of Part 5 of the Act.
In April 1998 the worker suffered injuries to his hand and arms, and, as a result, an incapacity. On 19 February 1999 he gave notice of a work-related injury to the exempt employer and he made a claim for compensation for the injuries which he alleged he sustained in the course of his employment. On 23 September 1999 the exempt employer rejected the worker’s claim for compensation. The worker filed a notice of dispute with the Tribunal and, following an unsuccessful conciliation, the proceedings were referred for immediate judicial determination.
The proceedings came on for hearing before his Honour Deputy President Judge McCusker on 30 August 2001. The hearing extended over eight sitting days between August 2001 and October 2003. Both the worker and the exempt employer were represented by counsel. The main issue in dispute was whether the worker’s injuries were caused or contributed to by his employment. On 31 August 2004 his Honour delivered his decision. He found in favour of the worker and upheld his application for compensation. Final orders have not yet been made.
The worker applied for an order that he have his costs of and incidental to the proceedings. That application was not opposed by the exempt employer. The worker also applied for an order that rule Twenty-Eight (7)(d) of the Workers Compensation Tribunal Rules 2001 not apply to the claim for costs in respect of the worker’s counsel fees. I will set out the terms of that rule a little later, but it is appropriate that at this point I provide a brief explanation of its operation.
The Workers Compensation Tribunal Rules 2001 were made by the President of the Tribunal pursuant to s 88E of the Act and they came into effect on 12 November 2001. The 2001 rules have been replaced by rules made in 2005, but the latter rules are not relevant to this matter. Rule Twenty-Eight of the 2001 rules dealt with the costs of proceedings at judicial determination. Rule Twenty-Eight (7) set out the principles to be applied in determining the quantum of a party’s costs and subrule (7)(d) provided for a sliding scale of counsel fees. It specified a figure for a fee on brief (an amount not exceeding $1,850.00) and hourly rates for periods in excess of the first five hours in court. The hourly rate decreased the longer the hearing continued. It was $165.00 for the period between 5 and 10 hours, $110.00 for the period between 10 and 20 hours and $70.00 for time spent beyond 20 hours. The effect of the sliding scale may be illustrated by an example. Assuming five-hour days in the Tribunal, the counsel fees for day five and beyond would have been $350.00 per day. Subrule (7)(e) gave a presidential member of the Tribunal the power to award an amount of up to $165.00 per hour for counsel fees for any period spent in court after the first five hours if the presidential member was of the opinion that the party against whom a costs order was to be made had unnecessarily prolonged the hearing.
In the alternative to an order that rule Twenty-Eight (7)(d) not apply to the claim for costs in respect of counsel fees, the worker applied for an order that rule Twenty-Eight (7)(e) apply, if that rule was valid.
It is not clear on what basis the worker was making his application that rule Twenty-Eight (7)(d) not apply to the claim. The worker’s alternative claim that rule Twenty-Eight (7)(e) apply was clearly made pursuant to the terms of the rule itself.
The exempt employer opposed the special orders in relation to counsel fees sought by the worker.
On 6 December 2004 the worker’s counsel informed Judge McCusker that the worker challenged the validity of rule Twenty-Eight (7)(d) and, as a consequence, the validity of rule Twenty-Eight (7)(e). By certificate dated 6 December 2004, Judge McCusker referred the question of the validity of those rules to the President of the Tribunal. The President exercised the power in s 94A(2) of the Act and referred the question of the validity of the rules to be determined by the Full Bench of the Tribunal.

The Full Bench of the Tribunal considered there was a doubt as to whether the Tribunal had jurisdiction to determine the validity of the rules and it decided to state a case for the opinion of this Court on that question and on the question of whether the rules were valid.
The Workers Compensation Tribunal Rules 2001 repealed the Workers Compensation Tribunal Rules 1996. The 1996 rules also contained a scale of counsel fees in rule Fifteen and, in a similar fashion to rule Twenty-Eight (7)(d) and (e) of the 2001 rules, made provision for a sliding scale of counsel fees and for a particular rate to apply if the party against whom a costs order was to be made had unnecessarily prolonged the hearing (rule Fifteen (7)(d) and (e)). For example, under the 1996 rules the daily rate for counsel fees for day five and beyond, assuming five-hour days, was $300.00. Rule Fifteen (7)(f) was a transitional provision, which provided that rule Fifteen (7)(d) and (e) applied to all trials commenced on or after 1 June 2000 and might, in the absolute discretion of the Presiding Member, apply to trials commenced before that date.
As the worker’s proceedings were commenced before the Workers Compensation Tribunal Rules 2001 came into effect and completed after such rules had come into effect, the parties agreed, and the Full Bench determined, that the questions of law should also include the same questions in relation to the validity of rule Fifteen (7)(d), (e) and (f) of the 1996 rules.
The case stated
The questions of law for the determination of this Court are as follows:
1.Does the Workers Compensation Tribunal have the jurisdiction to determine the validity of Rule Fifteen (7)(d), (e) and (f) of the Workers Compensation Tribunal Rules, 1996 and of Rule Twenty Eight (7)(d) and (e) of the Workers Compensation Tribunal Rules, 2001 as collateral issues in the determination of the costs entitlement of the Worker against his Employer?
2.Was the making of Rule Fifteen (7)(d), (e) and (f) of the Workers Compensation Tribunal Rules, 1996 a valid exercise of the power contained in Section 88E of the Act?
3.If Rule Fifteen (7)(d), (e) and (f) were validly made pursuant to Section 88E of the Act, are they inconsistent with the terms of Regulation 7(2) of the Workers Rehabilitation and Compensation (Dispute Resolution) Regulations 1996, and thereby invalid?
4.Was the making of Rule Twenty Eight (7)(d) and (e) of the Workers Compensation Rules, 2001 a valid exercise of the power contained in Section 88E of the Act?
5.If Rule Twenty Eight (7)(d) and (e) were validly made pursuant to Section 88E of the Act, are they inconsistent with the terms of Regulation 7(2) of the Workers Rehabilitation and Compensation (Dispute Resolution) Regulations 1996, and thereby invalid?
For convenience, I will refer to Rule Twenty-Eight (7)(d) and (e) of the 2001 rules and rule Fifteen (7)(d), (e) and (f) of the 1996 rules as the relevant rules.
The worker was represented by senior counsel before this Court. The WorkCover Corporation exercised its right of intervention under s 123A of the Act and was also represented by counsel. The exempt employer advised the Registry that it wished to take no part in the proceedings before this Court and it took no part in the proceedings. The worker submits that the questions of law should be answered as follows:
1Yes
2No
3Yes
4No
5Yes
The WorkCover Corporation submits that the questions of law should be answered as follows:
1No
2Yes
3No
4Yes
5No.
Relevant statutory provisions, regulations and rules
The long title to the Act states that the Act provides for the rehabilitation and compensation of workers in respect of disabilities arising from their employment and for other purposes.
The provisions in the Act which are directly relevant to the issues raised in the case stated are the costs provisions in s 88F and s 95, the regulation-making power in s 124 and the rule-making power in s 88E. Those sections are in the following terms:
88F—Costs of proceedings
Subject to this Act, the costs of proceedings before the Tribunal are in the discretion of the Tribunal.
…
95—Costs
(1)A party (other than the relevant compensating authority) is entitled, subject to this Part and to limits prescribed by regulation, to an award against the relevant compensating authority for the party's reasonable costs of—
(a)     the initial reconsideration of a disputed decision; and
(b)     any subsequent proceedings for resolution of the dispute under this Part (but not proceedings by way of an appeal or case stated to a Full Bench of the Tribunal or the Supreme Court).
(2)     Costs may only be awarded to cover—
(a)     the cost of representation by a legal practitioner or an officer or employee of an industrial association; and
(b)     costs of a kind authorised by the regulations that were reasonably incurred.
(3)If the Tribunal is of the opinion that a party acted unreasonably, frivolously or vexatiously in bringing or in relation to the conduct of proceedings, the Tribunal may—
(a)     decline to make an award of costs in favour of the party and may further (if it thinks fit) make an award of costs against the party; or
(b)     reduce the amount of the award to which the party would otherwise have been entitled.
(4)An award of costs to cover professional advice or assistance may, if the Tribunal considers appropriate, be made in favour of the person who provided the professional advice or assistance.
(5)An award of legal costs cannot exceed 85% of the amount that would be allowable under the relevant Supreme Court scale if the proceedings were in the Supreme Court.
…
124—Regulations
(1)The Governor may make such regulations as are contemplated by this Act, or as are necessary or expedient for the purposes of this Act.
(2)     Regulations made under this Act—
(a)     may be of general or limited application;
(b)     may allow for matters to be determined at the discretion of the Corporation (or a delegate of the Corporation) or confer other forms of discretionary power on the Corporation (or a delegate of the Corporation).
…
88E—Rules
(1)     The President may make Rules of the Tribunal—
(a)     regulating the business of the Tribunal and the duties of the various officers of the Tribunal; and
(b)     authorising conciliation and arbitration officers to exercise any part of the jurisdiction of the Tribunal; and
(c)     regulating the practice and procedure of the Tribunal; and
(d)     imposing mutual obligations on parties to proceedings in the Tribunal to disclose to each other the contents of expert reports or other material of relevance to the proceedings before the proceedings are brought to trial; and
(e)     regulating the form in which evidence may be taken; and
(f)    regulating costs; and
(g)     dealing with any other matter necessary or expedient for the effective and efficient operation of the Tribunal.
(2)Before making Rules of the Tribunal, the President must consult with a rules committee consisting of—
(a)     at least three presidential members; and
(b)     at least two conciliation and arbitration officers; and
(c)     the Registrar.
(3)The rules take effect as from the date of publication in the Gazette or a later date specified in the rules.
The relevant regulations are the Workers Rehabilitation and Compensation (Dispute Resolution) Regulations 1996, which were gazetted on 30 May 1996 and, pursuant to reg 2, came into operation on 3 June 1996.
Regulation 7(2), which is referred to in the third and fifth questions, is in the following terms:
Pursuant to section 95(1) of the Act, the costs awarded to a party who is represented in proceedings before the Tribunal under Division 6 of Part 6A of the Act cannot exceed 85 per cent of the costs that would be payable on a party and party basis if the proceedings were proceedings before the Supreme Court.
Regulation 7(1) provides that pursuant to s 95(1) of the Act, the limits on costs specified in the regulation are fixed in relation to proceedings that take place under Part 6A of the Act (other than Division 6, which deals with the judicial determination of a dispute) up to and including 31 December 2000. The items dealt with in the regulation include matters such as the costs of the preparation and lodgement of a notice of dispute, participation in the conciliation/dispute resolution process and the costs of the preparation of a case for an arbitration hearing. Regulation 7(3) deals with the costs which may be awarded to reimburse disbursements incurred by a party to a dispute pursuant to s 95(2)(b). Regulation 7(4) deals with costs in relation to proceedings under Part 6B of the Act for proceedings that take place up to and including 31 December 2000. Part 6B deals with applications to the Tribunal to deal with claims or other matters that require an expedited determination. I pause at this point to note that there is a section in Part 6B which provides that regulations may be made about the costs of proceedings under the Part: s 97C. Regulations 7 (5) – (9) inclusive deal with increases in the limits that are the subject of reg 7(1) and reg (4).
Rule Fifteen (7)(d), (e) and (f) of the Workers Compensation Tribunal Rules 1996, as amended, which were in force on the first day of the hearing before Judge McCusker, provided as follows:
(7)In determining the quantum of a party’s costs the presiding Member or Registrar or Deputy Registrar as the case may be shall adopt the following principles:
…
(d) A party entitled to an award of costs in respect of a trial at judicial determination may be awarded up to 85% of the Supreme Court scale for all reasonably necessary preparatory work. Consistent with the expectation that the parties shall have: obtained an advice on evidence; properly proofed all witnesses so as to be able to make an informed decision as to which witnesses are required to give oral testimony (if the witness is not otherwise required for cross-examination); carefully reflected upon the witness statements and expert reports of the other parties so as to be able to make an informed decision as to which witnesses are required for cross-examination; identified all potential issues and factual matters capable of agreement and have taken steps to secure agreement in respect thereof; shall be in a position to make submissions as to costs upon receipt of judgment; and generally have taken all reasonable measures to ensure that the trial proceeds expeditiously and only occupies sitting time in court to the extent that it is absolutely necessary*; the following scale of counsel fees (other than in respect of a referral pursuant to section 94A(2)) shall apply.
·Fee on brief – including conferences, reading time, preparation and up to the first 5 hours in court an amount not exceeding $1750.00.
·Refresher fees – if the trial extends beyond 5 sitting hours counsel fees will be based upon time spent in court and unless provision is specifically made, no further allowances shall be made for conferences; reading time or preparation. Such refresher fees shall be awarded as follows:
ùFor time spent beyond 5 hours and up to 10 hours – at the rate of up to $150.00 per hour.
ùFor time spent beyond 10 hours and up to 20 hours – at the rate of up to $100.00 per hour.
ùFor time spent beyond 20 hours – at the rate of up to $60.00 per hour.
ùWhere written submissions are provided costs shall be awarded on an hourly rate commensurate with 1.5 times that which would apply had the submissions been made orally.
ùWhere judgment is delivered in Court an amount of $100.00 to receive judgment.
*For example: converting video evidence into a short passage of edited highlights for showing in court (subject of course to all video tapes being made available to the other parties to the dispute after cross-examination of the relevant witness has been completed); obtaining and providing to the other parties copies of notes that a witness may seek to rely upon in giving evidence; scheduling witnesses so as to ensure that sufficient time is allowed for the receipt of their evidence; agreeing where possible to interpose witnesses and if interposition is not possible to indicate that to the other parties at the earliest possible time; arranging witnesses so as to ensure that the available time is best utilised.
(e) Notwithstanding the limitations on counsel fees previously expressed if the presiding Member is of the opinion that the party against whom a costs order is to be made has unnecessarily prolonged the hearing the presiding Member may award an amount of up to $150.00 per hour for counsel fees for any period of time spent in court after the first 5 hours.
(f) Transitional Provision
Rule Fifteen (7)(d) and (e) shall apply to all trials commencing on or after 1 June 2000 and may, in the absolute discretion of the presiding Member, apply to trials commencing before that date. Parties who already have disputes set down for hearing may wish to consider whether further steps can be undertaken to truncate the hearing of their matter and to reconsider the time previously specified as being required to conduct the hearing.
Rule Twenty-Eight (7)(d) and (e) of the Workers Compensation Tribunal Rules 2001 provided as follows:
(7)In determining the quantum of a party’s costs the presiding member or Registrar or Deputy Registrar as the case may be shall adopt the following principles:
…
(d) A party entitled to an award of costs in respect of a trial at judicial determination may be awarded up to 85% of the Supreme Court scale for all reasonably necessary preparatory work. Consistent with the expectation that the parties shall have: obtained advice on evidence; properly proofed all witnesses so as to be able to make an informed decision as to which witnesses are required to give oral testimony (if the witness is not otherwise required for cross-examination); carefully reflected upon the witness statements and expert reports of the other parties so as to be able to make an informed decision as to which witnesses are required for cross-examination; identified all potential issues and factual matters capable of agreement and have taken steps to secure agreement in respect thereof; shall be in a position to make submissions as to costs upon receipt of judgment; and generally have taken all reasonable measures to ensure that the trial proceeds expeditiously and only occupies sitting time in court to the extent that it is absolutely necessary*.
The following scale of counsel fees (other than in respect of a referral pursuant to section 94A(2) of the Act) shall apply.
·Fee on brief – including conferences, reading time, preparation and up to the first 5 hours in court an amount not exceeding $1850.00.
·Refresher fees – if the trial extends beyond 5 sitting hours counsel fees shall be based upon time spent in court and unless provision is specifically made, no further allowances shall be made for conferences; reading time or preparation. Such refresher fees shall be awarded as follows:
ùFor time spent beyond 5 hours and up to 10 hours – at the rate of up to $165.00 per hour.
ùFor time spent beyond 10 hours and up to 20 hours – at the rate of up to $110.00 per hour.
ùFor time spent beyond 20 hours – at the rate of up to $70.00 per hour.
·Where written submissions are provided costs shall be awarded on an hourly rate commensurate with 1.5 times that which would apply had the submissions been made orally.
·Where judgment is delivered in Court an amount of $110.00 to receive judgment.
*For example: converting video evidence into a short passage of edited highlights for showing in court (subject of course to all video tapes being made available to the other parties to the dispute after cross-examination of the relevant witness has been completed); obtaining and providing to the other parties copies of notes that a witness may seek to rely upon in giving evidence; scheduling witnesses so as to ensure that sufficient time is allowed for the receipt of their evidence; agreeing where possible to interpose witnesses and if interposition is not possible to indicate that to the other parties at the earliest possible time; arranging witnesses so as to ensure that the available time is best utilised.
(e)Notwithstanding the limitations on counsel fees previously expressed, if the presiding member is of the opinion that the party against whom a costs order is to be made has unnecessarily prolonged the hearing the presiding member may award an amount of up to $165.00 per hour for counsel fees for any period of time spent in court after the first 5 hours.
The purpose of the sliding scale of counsel fees seems to be to encourage expedition by counsel in the conduct of hearings before the Tribunal. A number of arguments might be put as to the appropriateness or otherwise of the mechanism adopted in the rules, but those arguments are not relevant to the issues before this Court and it is not appropriate that I make any comment on them. The rules are not challenged on the ground of Wednesbury unreasonableness (Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223), or a lack of reasonable proportionality in terms of the rule-making power (South Australia v Tanner (1989) 166 CLR 161). Nor are the relevant rules challenged on the ground that they were made for an improper purpose: R v Toohey; Ex parte Northern Land Council (1981) 151 CLR 170. I am not to be taken as deciding that those grounds are available in relation to a challenge to the rules of the Tribunal. I simply note that those grounds are not raised in the case stated.
Question 1: Collateral issues
The first question of law in the case stated is whether the Workers Compensation Tribunal has jurisdiction to determine the validity of the relevant rules “as collateral issues in the determination of the costs entitlement of the worker against his employer”.
The Tribunal has jurisdiction to make an order for the costs of a party. If the Tribunal is required to tax a party’s costs, a presidential member of the Tribunal may assign that task to the Registrar of the Tribunal, who may in turn assign the task to a Deputy Registrar. The Registrar or Deputy Registrar may tax the costs and prepare a certificate of recommendation, which is submitted to the presidential member. That member may adopt the recommendation with such modifications as he or she thinks appropriate. A party dissatisfied with the Registrar or Deputy Registrar’s certificate may make an application to the presidential member to be heard on whether he or she should adopt the certificate of recommendation. Under this procedure, the order for costs and the determination of the quantum of the costs is made by a presidential member of the Tribunal. If the Tribunal has jurisdiction to determine the validity of the relevant rules, it would be a presidential member who would make that determination as part of, or ancillary to, a judicial determination of a disputed claim under Division 6 of Part 6A of the Act.
The alternative procedure in terms of a challenge to the validity of the relevant rules is a summons for judicial review issued in this court under r 98 of the Supreme Court Rules 1987. This procedure involves a direct challenge to the validity of the relevant rules in the sense that the action is designed for the purpose of hearing and determining the challenge to the validity of the relevant rules.
If the Tribunal has the power to hear and determine a challenge to the relevant rules in the course of determining the question of costs on a judicial determination of a disputed claim, that would involve a collateral challenge to the validity of the relevant rules, as distinct from a direct challenge. It appears that the term “collateral challenge” is not always used to express the same concept, but for present purposes I will adopt the description of a collateral challenge given by McHugh J in Ousley v The Queen (1997) 192 CLR 69 (“Ousley”) at 98 – 99 (footnotes omitted):
A collateral attack on an act or decision occurs when the act or decision is challenged in proceedings whose primary object is not the setting aside or modification of that act or decision. In In re Preston, however, Lord Scarman used the term "collateral challenge" to include any process challenging a decision -- including an application for judicial review -- other than a proceeding by way of appeal. This use of the term is readily intelligible. However, with the widespread availability of judicial review procedures, it conduces to clarity of thought, in my opinion, if the term "collateral challenge" is confined to challenges that occur in proceedings where the validity of the administrative act is merely an incident in determining other issues.

A presidential member may be called upon to determine questions of law in the course of a judicial determination of a disputed claim and it was not suggested by the WorkCover Corporation that he or she did not have the jurisdiction to do so. It is clearly implicit in s 86(1) that a single presidential member has jurisdiction to determine questions of law. That section provides:
86—Appeal on question of law
(1)An appeal lies on a question of law against a decision of the Tribunal constituted of a single presidential member to a Full Bench of the Tribunal.
However, the presidential member does not have the power to make a declaration of right as to the validity of the rules. In other words, there is no equivalent in the Act of s 31 of the Supreme Court Act 1935, which gives this Court the power to make binding declarations of right. Relevantly for present purposes, a presidential member has power to make a judicial determination of a disputed claim and orders as to costs. If a presidential member has jurisdiction to determine the validity of the relevant rules, he or she would be determining a question of law in the course of making orders as to costs including an order fixing the quantum of costs. I mention at this point that no appeal lies from the Full Bench of the Tribunal and the only challenge to a decision of the Full Bench is in proceedings before the Full Supreme Court founded on an alleged excess or want of jurisdiction: s 88I.
I am satisfied that a challenge to the validity of the relevant rules in the proceedings in the Tribunal would be a collateral challenge. The first question of law raises the issue of whether that is permissible.
This Court considered whether it was permissible to mount a collateral challenge to administrative action alleged to be unlawful in Hinton Demolitions Pty Ltd v Lower(No 2) (1971) 1 SASR 512 (“Hinton Demolitions Pty Ltd v Lower (No 2)”). The appellant in that case was convicted of two offences under the Road Maintenance (Contribution) Act 1963 – 1968 in relation to a commercial goods vehicle consisting of a truck and trailer. The first offence was of failing to keep accurate daily records of the journeys of the vehicle along public roads in South Australia and the second offence was of failing to pay the Commissioner of Highways the charges in respect of the vehicle. The relevant provisions of the Road Maintenance (Contribution) Act 1963 - 1968 did not apply to a vehicle the load capacity of which did not exceed eight tons. The load capacity was determined (relevantly) by the load capacity shown in the certificate of registration issued under the Motor Vehicles Act 1959 – 1962. Regulations made under the Motor Vehicles Act 1959 – 1962 gave the Registrar of Motor Vehicles the power to determine the load capacity of any commercial vehicle and to enter the same in the certificate of registration. The Registrar of Motor Vehicles determined a load capacity of the appellant’s commercial vehicle and entered the figure in the certificate of registration. The figure brought the appellant’s vehicle within the provisions of the Road Maintenance (Contribution) Act 1963 – 1968.
The appellant challenged the validity of the regulations made under the Motor Vehicles Act 1959 - 1962. That challenge was rejected for similar reasons to those given in an earlier case involving a challenge to the regulations: Hinton Demolitions Pty Ltd v Lower [1968] SASR 370 (“Hinton Demolitions Pty Ltd v Lower”). It may be noted at this point that there was no suggestion in either Hinton Demolitions Pty Ltd v Lower or Hinton Demolitions Pty Ltd v Lower(No 2) that the validity of the regulations could not be raised in the course of a prosecution before a court of summary jurisdiction. The regulations were said by the appellant to be invalid on the ground of uncertainty.
For present purposes, the main point in Hinton Demolitions Pty Ltd v Lower (No 2) was whether the determination by the Registrar of Motor Vehicles of the load capacity of the appellant’s vehicle could be challenged in the course of a prosecution before a court of summary jurisdiction on the ground that the Registrar was bound to, but had failed to comply with, the rules of natural justice in that he had not heard from the appellant before fixing the load capacity. In other words, could an alleged breach of the rules of natural justice be raised in a prosecution in a court of summary jurisdiction, or could it only be raised in an action for one of the prerogative writs or an action against the Registrar for a declaration. Bray CJ discussed the void/voidable distinction and the authorities on that subject and said (at 523 – 524):
In short, it seems to me that, once the law makes the distinction between administrative acts which are nullities and those which are merely voidable, it must follow amongst other consequences that an invalidity of the former class can be asserted by anyone in any proceeding in which the invalidity is relevant, whereas an invalidity of the latter class can only be successfully asserted in appropriate proceedings brought by the appropriate party.
…
If I am right so far, I think there is no doubt that the present case falls into the second class. A determination was made without the appellant being heard; but it cannot be contended that it was made for a frivolous or futile cause. And the scheme of the statute affords strong ground, it may be sufficient ground by itself, for the conclusion that the courts must accept the load capacity as shown in the certificate of registration so long as the relevant entry in the certificate stands, indeed, that by virtue of the definition clause the load capacity mentioned in the certificate is the load capacity for the purpose of proceedings under the Road Maintenance (Contribution) Act. That entry could, in my view, be quashed on certiorari if the court thought that natural justice or fairness was legally required and lacking. So, perhaps, an action against the Registrar for a declaration might achieve a similar result. In either case the Registrar would be a party: in these proceedings he is not.
Wells J took a narrower view as to the circumstances in which a collateral challenge was permitted. After an extensive review of the authorities on that subject, Wells J summarised (at 548 – 550) the relevant principles in eight propositions, the second of which is the important one for present purposes (at 549):
2.Except for those cases where what is claimed to be an administrative act has not even the colour of lawful authority, or where an authority or public official, who is a party to a civil action, pleads, and relies on his own administrative act, an allegedly unlawful administrative act cannot be collaterally impeached in any cause or matter, civil or criminal, unless an Act of Parliament or a valid regulation unequivocally authorises such impeachment. The only correct way of attacking an allegedly unlawful administrative act is by means of a separate proceeding appropriate for the purpose.
Relevantly, Mitchell J agreed (at 525) with the reasons of both Bray CJ and the reasons of Wells J.
In Epstein v WorkCover Corporation of South Australia (2003) 85 SASR 561, the Full Bench of the Tribunal stated a case for the opinion of this Court, which included a question as to whether the Tribunal could determine a challenge to the validity of a regulation in the course of a judicial determination of a disputed claim under the Act. The Full Bench considered that the decision of this Court in Hinton Demolitions Pty Ltd v Lower (No 2) at least raised a doubt as to whether the Tribunal had such a power. This Court found it unnecessary to determine the question, because after the Tribunal had stated the case, the plaintiffs brought an action in this Court for a declaration that the regulation was invalid and the Court was able to determine the issue in that action.
The Full Court in this case was constituted of five Justices because it was considered that it might become necessary to consider the correctness of the decision in Hinton Demolitions Pty Ltd v Lower (No 2).
I do not think a clear majority view emerges from the decision in that case.As I have said, Mitchell J relevantly agreed with the reasons of both Bray CJ and Wells J. In addition to that point, the case was quite a different one from the present. The relevant rules are a form of delegated or subordinate legislation: Subordinate Legislation Act 1978, s 4; Pearce and Argument, Delegated Legislation in Australia (2^nd ed, 1999), [1.7]. The relevant rules are challenged on the ground of ultra vires in what is sometimes said to be the simple or narrow sense in that they are alleged to be beyond the statutory rule-making power or inconsistent with other legislative provisions. They are not challenged on grounds that may require the adducing of substantial evidence. For these reasons, this case is quite different from Hinton Demolitions Pty Ltd v Lower (No 2), where an administrative decision was said to be bad by reason of a breach of the rules of natural justice.
In my opinion, a collateral attack on the validity of the relevant rules in the sense I have described is permissible. That conclusion follows from the acceptance of two propositions. First, as I have said, the relevant rules are a form of delegated or subordinate legislation. They are the product of a legislative act, not an administrative decision. Secondly, there is clear authority that, at least when the challenge is on the ground of simple or narrow ultra vires, a person prosecuted for the breach of a by-law or regulation may raise as a defence in the criminal court the invalidity of the by-law or regulation: Bishop v Deverix [1908] SALR 122; Mayor of Hobart v Maxwell (1900) 2 N & S 8; Spreadborough v Walcott; Ex parte Walcott [1904] St R Qd 104; Langley v Edwards (1908) 10 WALR 108. See also Pearce and Argument (supra) at [26.1] and Sykes, Lanham, Tracey and Esser, General Principles of Administrative Law (4^th ed, 1997) at [2311]. Nor was there any suggestion that such a course was not an appropriate one in the decision of the Divisional Court in Kruse v Johnson [1898] 2 QB 91, or in the decision of the High Court in Widgee Shire Council v Bonney (1907) 4 CLR 977.
In my opinion, this case is sufficiently analogous to such a case that the same principle should be applied here.
The Court was also referred to two recent authorities on the question of collateral challenge: the decision of the House of Lords in Boddington v British Transport Police [1999] 2 AC 143 (“Boddington”) and the decision of the High Court in Ousley.
In Boddington, the House of Lords was required to determine if a person charged under a by-law with smoking a cigarette on a railway carriage could challenge the validity of the by-law and an administrative decision made under it in the course of the prosecution of the offence before a stipendiary magistrate. The House of Lords held that he could, although ultimately it held that the by‑law and the administrative decision made under it were valid. The Law Lords rejected a suggested distinction formulated in Bugg v Director of Public Prosecutions [1993] QB 473 between a challenge based on substantive invalidity and a challenge based on procedural invalidity. In the former, a collateral challenge was permissible, whereas in the latter it was not. The Law Lords referred to the general rule of procedural exclusivity judicially created in O’Reilly v Mackman [1983] 2 AC 237. Lord Steyn noted that there were a number of exceptions to the general rule of procedural exclusivity, before stating (at 172 - 173):
Since O’Reilly v Mackman decisions of the House of Lords have made clear that the primary focus of the rule of procedural exclusivity is situations in which an individual’s sole aim was to challenge a public law act or decision. It does not apply in a civil case when an individual seeks to establish private law rights which cannot be determined without an examination of the validity of a public law decision. Nor does it apply where a defendant in a civil case simply seeks to defend himself by questioning the validity of a public law decision. These propositions are established in the context of civil cases by four decisions of the House of Lords: Roy v Kensington Family Practitioner Committee [1992] 1 AC 624; Chief Adjudication Officer v Foster [1993] AC 754; Wandsworth London Borough Council v Winder [1985] AC 461 and in particular at pp 509-510, per Lord Fraser of Tullybelton; Mercury Communications Ltd v Director General of Telecommunications [1996] 1 WLR 48 and in particular at p 57 _B-E, per Lord Slynn of Hadley. One would expect a defendant in a criminal case, where the liberty of the subject is at stake, to have no lesser rights. Provided that the invalidity of the byelaw is or maybe a defence to the charge a criminal case must be the paradigm of collateral or defensive challenge. And in Director of Public Prosecutions v Hutchinson [1990] 2 AC 783, [1990] 2 AC 783, a criminal case, the House of Lords allowed a collateral challenge to delegated legislation. The judgment in Bugg v Director of Public Prosecutions [1993] QB 473 in effect denies the right of defensive challenge in a criminal case. In my view the observations in Bugg’s case are contrary to authority and principle.
We do not have a general rule of procedural exclusivity in this country, and Boddington and the English cases since it must be approached with some caution. Nevertheless, Boddington does support the proposition that a by-law or regulation may be collaterally challenged in a criminal prosecution for an offence under the by-law or regulation.
In Ousley, the High Court decided that the issuing of a warrant under the Listening Devices Act 1969 (Vic) was an administrative act and that therefore the validity of the warrants could be challenged collaterally in the course of a criminal trial. Although a majority of the Justices considered that the grounds of challenge are limited, and McHugh J referred to the difficulties occasioned by allowing collateral challenges in the course of a criminal trial, there is nothing in the judgments in Ousley to suggest that a collateral challenge of the type advanced in this case should not be permitted.
I appreciate that this is not a prosecution in the Workers Compensation Tribunal under a by-law or a regulation. These proceedings are civil proceedings, or akin to civil proceedings, affecting the appellant’s private law rights. Nevertheless, the relevant rules are central to a determination of the appellant’s rights and I see no reason in principle why the authorities which involved a criminal prosecution under a by-law or regulation should not be applied in this case.
I propose to restrict the answer to the first question in the case stated to the grounds of challenge advanced in this case. As I have said, the relevant rules are not challenged on the grounds of Wednesbury unreasonableness or a lack of reasonable proportionality in the terms of the rule-making power, or improper purpose. It is not necessary to decide whether a collateral challenge is permissible in a case where the grounds of challenge are likely to involve the adducing of substantial evidence.
I have considered if the question whether a collateral challenge is permissible in this case may be answered by reference to a general principle that applies in the case of all legislative and administrative acts. However, I do not think the law has reached the stage where such a general principle has been identified. The authorities are still in a state of flux and, to adopt the words of Bray CJ in Hinton Demolitions Pty Ltd v Lower (No 2) (at 520 – 521), it is “hardly likely that this Court will be able to construct an enduring causeway through the flood”. Having said that, since 1971 there have been authoritative decisions such as Boddington and Ousley, which provide the answer to whether a collateral challenge is permitted in particular areas.
It is very difficult to answer Professor H W R Wade’s criticism in the administrative law context of the use of the suggested distinction between acts or decisions which are void and those which are voidable as merely conclusory: H W R Wade, “Unlawful Administrative Action: Void or Voidable?” (1967) 83 Law Quarterly Review 499 (Pt 1) and (1968) 84 Law Quarterly Review 95 (Pt 2) (see also (1974) 90 Law Quarterly Review 154). Furthermore, there are difficulties with the suggested distinction between substantive invalidity and procedural invalidity, as discussed by Lord Steyn in Boddington (at 169 - 171) and by Lord Nicholls of Birkenhead in R v Wicks [1998] AC 92 at 108 (“Wicks”). A suggested distinction between patent and latent invalidity has also been criticised: Federal Airports Corporation v Aerolineas Argentinas and Ors (1997) 76 FCR 582 per Lehane J at 599.
I do not think there is any doubt that in some cases there are good reasons to allow a collateral challenge and in other cases there are good reasons to deny it. On occasions there may be cases in which a statutory provision will provide a clear answer to the question whether a collateral challenge is permitted in a particular case. Other possible factors which might be relevant in deciding that question have been discussed in the authorities and in the academic literature. I refer to two articles for a helpful discussion of the relevant factors: M Aronson, “Criteria for Restricting Collateral Challenge” (1998) 9 Public Law Review 237 and Professor Enid Campbell, “Collateral Challenge of the Validity of Governmental Action” (1998) 24 Monash University Law Review 272. The factors identified include the following:
1Are the grounds of challenge likely to involve the adducing of substantial evidence?;
2If a collateral challenge is permitted, will all proper parties be heard before the court or tribunal in which the collateral challenge is to be heard?;
3In the particular case, does the allowing of a collateral challenge by‑pass the protective mechanisms associated with judicial review proceedings such as the rules as to standing, delay and other discretionary considerations?;
4Is there a statutory provision that bears in one way or another on the question of whether a collateral challenge should be permitted?
5Is the issue raised by the collateral challenge clearly answered by authority?;
6Are there other cases pending which raise the same issue?
7(Possibly) Is there a more appropriate forum in terms of expertise and perhaps court procedures such that a collateral challenge should not be permitted?
As a cross-check, I think my conclusion that a collateral challenge is permitted in this case is confirmed by reference to most of the above factors. The grounds of challenge in this case do not involve the adducing of substantial evidence; nor is there any difficulty with the proper parties being before the Tribunal. I do not think moreover that any of the protective mechanisms contained in r 98 of the Supreme Court Rules 1987 would be by-passed if a collateral challenge is permitted in this case. There is no statutory provision that indicates or suggests that a collateral challenge ought not to be permitted, and there is nothing to suggest that the Workers Compensation Tribunal does not have the necessary expertise to determine the validity of the relevant rules. As against this last point, it might be said that it would be preferable for the validity of the relevant rules of the Tribunal to be determined by this Court rather than, in the first instance, by the Tribunal: Taylor v Guttilla (1992) 59 SASR 361 per King CJ at 368.
It may be that, leaving aside cases where a statutory provision provides a clear answer, the common law will develop to the point whereby a court or tribunal in which a collateral challenge is raised has a discretion to entertain the collateral challenge, or to decline to do so and invite the party raising the challenge to institute judicial review proceedings in the court with jurisdiction to entertain such proceedings. Such a suggestion, at least in the context of a collateral challenge raised in a criminal court, was discussed by Lord Nicholls of Birkenhead in Wicks at 107. The discretion would be exercised by reference to the factors identified in [93] above. Another suggestion, as discussed by Professor Campbell in her article, is to invest in the lower courts and tribunals the power to refer to the court with jurisdiction to entertain judicial review proceedings an issue raised by a collateral challenge, and to invest in that court the power on application by an appropriate person to remove the issue into that court.

At all events, the formulation of a general principle (if there is to be one) as to when the validity of government action, whether it be legislative or administrative in character, may be challenged collaterally must be reserved for the High Court.
This case may be determined by reference to the authorities and principles to which I have referred and the answer to the first question is as follows:
Yes, where the challenge to the validity of the rules is based on the ground of simple ultra vires, namely, the rules exceed the scope of the empowering legislation or, in the alternative, on the ground that the rules are inconsistent with the terms of reg 7(2) of the Workers Rehabilitation and Compensation (Dispute Resolution) Regulations 1996, and thereby invalid.
Questions 2 and 4: the scope of the rule-making power in s 88E
The appellant submits that the critical section in the Act is s 95. He submits that the section prescribes rules for the determination of the quantum of a party’s costs and that there is no room for the exercise of the rule-making power in s 88E(1)(f) to make rules of the Tribunal prescribing a scale of costs. It was not argued by the appellant that, looking no further than s 88E(1)(f) and the relevant rules, that the latter could not be characterised as rules “regulating costs”. The appellant submits that s 95 deals exhaustively with the subject of the quantum of the parties’ costs and that s 88E(1)(f) must be read down so as to exclude a power to make rules which prescribe a scale of costs.
Section 95(1) deals with the costs of a party against the relevant compensating authority of the initial reconsideration of a disputed decision and, subject to an exception not presently material, the costs of any subsequent proceedings for the resolution of the dispute under Part 6A. Subject to that Part and to limits prescribed by regulation, a party is entitled to “reasonable costs”.
It is convenient at this point to say something about Part 6 and Part 6A of the Act. Part 6 of the Act deals with the establishment, constitution, jurisdiction and powers of the Tribunal. The Tribunal has the jurisdiction conferred by statute (s 79) and has the power to perform various tasks, including conciliation, arbitration and the judicial determination of a disputed claim. As noted above, the President of the Tribunal has the power to make rules of the Tribunal, including rules “regulating costs” and, subject to the Act, the costs of proceedings before the Tribunal are in the discretion of the Tribunal (s 88F). Section 88G provides that a representative of a party to proceedings before the Tribunal must not charge nor seek to recover for work involved in, or associated with, that representation an amount exceeding the amount allowable under a scale fixed by regulation. No regulations have yet been made under this section.
Part 6A sets out a procedure for the resolution of disputes in relation to a “reviewable decision” (defined in s 89A). There are various steps in the procedure (some in the alternative), including initial reconsideration (Division 3); conciliation proceedings (Division 4); arbitration (Division 5), and judicial determination of a dispute (Division 6).
There are sections dealing with costs in the various divisions. For example, in Division 5, s 93B provides that in relation to the award of lump sum compensation, a worker is not to receive the costs of arbitration if the amount to be awarded on arbitration is the same as or less than 10 per cent above the amount offered in conciliation proceedings. In Division 6, s 94C is a broadly similar provision in relation to the judicial determination of a disputed claim. Section 95 is in Division 7. I have already referred to s 95(1). Section 95(2) provides that costs may be awarded to cover the cost of representation by a legal practitioner or an officer or employee of an industrial association and costs of a kind authorised by the regulations that were reasonably incurred. Section 95(3) provides that the Tribunal may decline to award costs to a party, or award costs against a party, or reduce the costs awarded to a party, if it is of the opinion that the party acted unreasonably, frivolously or vexatiously in bringing or in relation to the conduct of proceedings. Section 95(5) provides that an award of costs cannot exceed 85 per cent of the amount that would be allowable under the relevant scale if the proceedings were in the Supreme Court.
It should be noted that the Supreme Court Rules1987 do not contain a scale of counsel fees. There is a guide to counsel fees that contains a daily trial fee, which is the same irrespective of how long the trial proceeds. The guide to counsel fees makes it clear that it is not a scale of fees to be charged by counsel.
Regulation 7(2) is an exercise of the regulation-making power in s 95(1) and s 124 to prescribe limits to an award of a party’s reasonable costs. It provides that the costs awarded to a party in relation to a judicial determination of a disputed claim cannot exceed 85 per cent of the costs that would be payable on a party and party basis if the proceedings were proceedings before the Supreme Court. There appear to be differences between the limits specified by s 95(5) and the limit prescribed by reg 7(2), but these were not explored in argument. For example, the section refers to the relevant Supreme Court scale, whereas the regulation makes no reference to a scale. As I have said, the guide to counsel fees is not a scale of costs. The regulation refers to costs that would be payable on a party and party basis, whereas the section makes no reference to the basis upon which the costs are payable.
It was not in dispute, and nor could it be, that a regulation made under s 95(1) and s 124 could not increase the limit specified in s 95(5). A regulation might lower the limit in s 95(5), or it might deal with matters not dealt with by s 95(5), but it could not validly increase the limit. Nor, assuming for a moment that the rule-making power to regulate costs could be used to prescribe a scale of costs, could a rule be made that increased the limits specified in s 95(5) or a limit prescribed by regulations. It is not suggested here that the relevant rules are invalid because they purport to do that.
The appellant’s submission is that a party entitled to costs under s 95 is entitled to his or her costs quantified in accordance with the limit specified in s 95(5) or, assuming it is lower, the limit prescribed by reg 7(2) and such other regulations as may be relevant. If that submission is not accepted, the appellant’s alternative submission is that, subject to those limits, a party is entitled to his or her “reasonable costs”. The appellant submits that, by reason of the reference in s 95(1) to “subject to this Part”, that right is subject only to such other provisions in Part 6A as may be relevant. Those provisions include ss 93B, 94C and certain subsections of s 95 that give the Tribunal a power to make a different order as to costs if, speaking broadly, the conduct of the party claiming costs has been unreasonable. The appellant points to the fact that s 88E(1)(f) is in Part 6 of the Act, and s 95(1) is not expressed to be subject to that Part.
The appellant submits that this does not leave s 88E(1)(f) without work to do. He gave examples of circumstances in which rules regulating costs might be made, including rules relating to the liability for, and quantum of, costs in relation to a referral for conciliation, a redemption under s 49(5) and (6), appeals to the Full Bench, cases stated to this Court and, possibly, a challenge to the jurisdiction of the Tribunal prior to the reconsideration of a disputed decision (s 91 and s 95(1)). It was submitted that rules “regulating costs” might also be made in relation to procedural matters such as the taxation of costs, procedures for the making of special application in respect of costs (for example, pursuant to s 95(3)), the form of bills of costs and, possibly, rules as to the payment of costs thrown away on an adjournment.
In my opinion, the appellant’s submissions must be rejected. Section 95(5) does not purport to specify a rule or rules as to how a party’s costs are to be quantified. It provides a limit or ceiling which Parliament has seen fit to impose, presumably because it does not wish the dispute resolution procedure to become too costly, and it does not purport to give a party a right to costs quantified at 85 per cent of the amount that would be allowable under the relevant Supreme Court scale if the proceedings were in the Supreme Court. I take the same view of any limit prescribed by a regulation made under s 95(1) and s 124. The regulation-making power is one to prescribe limits, not to fix a scale of costs. No doubt a regulation could prescribe limits in relation to a number of items, but that would not be a scale of costs. In my opinion, the regulation-making power in s 95(1) reflects a parliamentary intention to empower the Governor in Executive Council to fix lower limits than that specified in s 95(5), as the need arises.
The appellant’s alternative submission that a party has a statutory right to his or her reasonable costs subject to the limits specified in s 95(5) or by regulation or the provisions of Part 6A, must also be rejected. The practice of giving a court or tribunal the power to prescribe a scale of costs in relation to proceedings before it is a time-honoured one. It serves the useful purpose of reducing the costs and delay associated with disputes as to the appropriate quantum of costs in any particular case. That would not be achieved by the construction of the sections put forward by the appellant as part of his alternative submission. On the appellant’s construction of the sections, absent agreement between the parties, a party’s reasonable costs would have to be assessed in every case in a way likely to protract the determination of the question of costs. It is true that there is some awkwardness in the proper construction of s 95(1), caused by the use of the word “reasonable”. However, I think that awkwardness largely disappears when regard is had to the effect of the section. Subject to the qualifications and limitations contained in the section, it confers a right to costs on a party to proceedings, irrespective of the outcome of the proceedings. In those circumstances, it is not surprising that Parliament considered it appropriate to make it clear that the right was a right to no more than reasonable costs. Whether the word adds anything to the section is perhaps debatable, but I cannot think that by using the word, Parliament was intending to prescribe such a general criterion for the quantification of a party’s costs to the exclusion of the rule-making power in s 88E(1)(f).
In my opinion, the relevant rules were a valid exercise of the power contained in s 88E(1)(f) and the answer to the second and fourth questions is yes.
Questions 3 and 5: inconsistency between the regulations and the rules
I have already held that the relevant rules were a valid exercise of the power contained in s 88E of the Act. Inconsistency between reg 7(2) and the relevant rules will arise if there is a direct inconsistency between the two, or it may arise if the regulation evinces an intention to cover the field of the subject matter dealt with by the rules.
As I have said, it is not suggested the amounts specified in the relevant rules exceeded the limit prescribed by reg 7(2) and it follows that there is no direct inconsistency between the regulation and the rules. Nor were the rules inconsistent with the regulation because the regulation covers the relevant field. The regulation, like s 95(5), prescribes a limit, but for the same reasons I have given in the course of answering the second and fourth questions, the fixing of a limit by reg 7(2) does not preclude the prescribing of a scale of costs by rules made by the President of the Tribunal under s 88E(1)(f).
In my opinion, the answer to the third and fifth questions is no.
Conclusion
In my opinion, the questions of law in the case stated should be answered as follows:
1Yes, where the challenge to the validity of the rules is based on the ground of simple ultra vires, namely, the rules exceed the scope of the empowering legislation or, in the alternative, on the ground that the rules are inconsistent with the terms of reg 7(2) of the Workers Rehabilitation and Compensation (Dispute Resolution) Regulations 1996, and thereby invalid.
2Yes.
3No.
4Yes.
5No.
The parties should be heard as to the appropriate order and costs.
VANSTONE J: I agree that the questions in the case stated should be answered as proposed by Besanko J for the reasons which he has given.
LAYTON J: I have had the advantage of reading the reasons given by Besanko J. I agree that the questions of law in the case stated should be answered as indicated by His Honour and I agree with his reasons.